Despite expectations of lower interest rates prompting homebuyers to leave the sidelines, a new report says the Bank of Canada害羞草研究所檚 quarter-point cut to its key interest rate last month did not lead to a rush in demand.
The latest Royal LePage house price survey released Thursday, detailing market trends across Canada during the second quarter, said demand continues to outpace supply in the Prairies and Quebec, but Toronto and Vancouver saw slower-than-usual activity this spring.
Phil Soper, president and CEO of Royal LePage, said prices have remained sticky in Canada害羞草研究所檚 largest markets.
害羞草研究所淭his spring, with bank rate cuts highly anticipated, we saw some buyers race to get a deal done ahead of an expected spike in demand,害羞草研究所� said Soper in a press release.
害羞草研究所淵et, when that first cut finally occurred in early June, market response was tepid.害羞草研究所�
A Royal LePage survey conducted by Leger earlier this year suggested 51 per cent of would-be homebuyers would resume their search if interest rates decreased, but just 10 per cent said a 25-basis-point cut would prompt them to jump back into the market.
Around 18 per cent said they were waiting for a cut of 50 to 100 basis points, and 23 per cent said they need to see a drop of more than 100 basis points.
害羞草研究所淣ot surprisingly, the quarter-point cut to the bank rate didn害羞草研究所檛 substantially improve the affordability picture,害羞草研究所� said Soper.
害羞草研究所淭he tale the market tells as rate cuts get to the point of a material reduction in the cost of borrowing should be a very different one.害羞草研究所�
The national aggregate home price rose 1.9 per cent year-over-year to $824,300 in the second quarter of 2024, which was also a 1.5 per cent increase from the first quarter, according to the report.
The figure is compiled from the company害羞草研究所檚 property data nationally and regionally in 64 of Canada害羞草研究所檚 largest real estate markets.
When broken out by housing type, the national median price of a single-family detached home increased 2.2 per cent year-over-year to $860,600, while the median price of a condominium increased 1.6 per cent to $596,500.
Royal LePage is also forecasting the aggregate price of a home in Canada will increase nine per cent to $860,555 in the fourth quarter of 2024 compared to the same quarter last year.
READ ALSO:
