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16 Aug

Canadian Housing Market Weakens in July 2017

General

Posted by: Anne Martin

The release by the Canadian Real Estate Association for the month of July confirms that important housing markets in Canada continued to slow down especially the Golden Horseshoe area that surronds Toronto.  The slowdown started in April in this area starting mostly with the announcement of the 15 % foreign buyers tax credit and the 16 point program announced provincially to enhance home affordability.

Then the Bank of Canada announced a rate hike in July, the first in seven years which had further effects on the economy, causing mortgage rates to increase along with the value of the Canadian dollar.  The posted mortgage rate which is often used as the mortgage qualifying rate for insured mortgage loans increased by 20 basis points which affected mortgage applicants ability to income qualify for their mortgages, taking some out of the mortgage and home buying market.  There is a proposal to extend this qualification to uninsured mortgage borrowers as well, meaning those who have more than 20% down payment or equity in their homes.

CREA saw the number of home sold in July decrease by 2.1% for the fourth consecutive month.  Sales activity is down by 15.3% from the activity of March this year.  Year over year, sales is down 11.9% for July.

The number of new listings went downward by 1.8% in July, led by the GTA.  In July is was seen that the national sales to new listings ratio balanced out to 53.5%.  Above 60% is considered a sellers market and below 40% is considered a buyers market.  More than 60% of all local markets are now in a more manageable buyers market.

Prices continue to decline.

Home prices continued to fall in July, extending the decline that began in April.  The Aggregate Composite MLS House Price Index rose by 12.9% year-over-year in July, a further deceleration from the pace earlier this year. The decline in price growth from June to July was the result of softening prices in the GGH.  Price gains reduced in all categories of homes including townhouses, detached family home and bungalows.

With exerts from Dr. Sherry Cooper, economist for Dominion Lending Centres.    http://ow.ly/FQa830esxA9

In the city of Barrie, smaller price increases are being seen with the housing market leveling out.

“We are now seeing the housing market level out with smaller price increases in some areas and decreases in some of our smaller areas compared  with.  With things evening out, your local Realtor will help you get the most value for your real estate transaction.”                                                                                                                                                    ‐ Rob Alexander, 2017 President, Barrie & District  Association of REALTORS® Inc. (BDAR)

The city of Barrie saw an increase in detached residential prices of 18% in the month of July 2017 over the average price in the same month 2016.

Townhouses increased by 14% in the same period and Condos had a whopping 37% increase in July 2017 over July 2016.

For more info on the residential statistics for Barrie and District please follow this link.  http://ow.ly/wiTt30esxpG