You might have a lot of questions when it comes to the Canadian vs the US housing market. Are you wondering whether the US are in a bubble? Or are they going to cool down after spending 15 months in solid gains? These questions are what most real estate industry observers are wondering across the nation, as we start to ease out of the public health crisis that we have been experiencing over the past year and a half.
Both Canada and the US have been going through similar experiences within their respective real estate industries. The most obvious real estate fact both nations have in common – sales activity and price growth (appreciation) has gone through the roof since the pandemic began. Housing gains have been monumental in both nations, and, in certain segments of the market, this growth has been record-breaking.
But how similar is the Canadian housing market be to the US market right now? Here is a deep dive into the numbers.
The National Association of Realtors (NAR) reported a 1.4% increase in existing home sales across the US, following four months of consecutive declines. Home resales advanced at a 22.9% annualized rate.
Prices have gone through substantial growth in the second quarter, which was held up by tighter inventories and huge demand. NAR data shows that the median existing house price climbed up 23.4% year over year in June to $363,000.
In the USA, economists are cautioning that housing affordability is creating critical issues in markets straight across their nation.
So how do things compare in the Canadian real estate market?
In Canada, due to lack of available inventory (new listings), national home sales fell 8.4% month over month in June, as per data shown by the Canadian Real Estate Association (CREA). However, despite current inventory lows, home sales remained up 13.6% year over year. The
MLS Home Price Index rose 0.9 percent from May and 24.4 percent year over year.
Inventory remains tight, as numbers of newly listed residential properties fell 0.7%. The number of months of inventory was at 2.3% at the end of June, which is up from a record low in March –remaining below statistical average.
Data from the Canada Mortgage and Housing Corporation (CMHC) shows that the annual pace of housing starts slowed in June, lowering by 1.5% to 282,070 units.
While there has been a rash of activities, the market is starting to stabilize over the past few months. A supply shortage remains in most parts of the country, but there is not the same level of competition and bidding war frenzy among buyers, as compared to a few months ago.
Market conditions will continue to evolve over the Fall season – so to keep up to speed, your best bet is to contact your trusted local realtor, who will provide you with relevant information and guidance about buying or selling a home during this cycle.
Are you looking at houses for sale in Woodbridge, Kleinberg, Nobleton or King City? Set up a call today with Re/Max representative John Burdi for more information!
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