Supply issues persist, sellers’ market to continue: Royal LePage

By Hana Mae Nassar and The Canadian Press

The latest forecast from Royal LePage is good news if you plan on selling your place — but not so great if you’re buying.

The company says prices are expected to continue to rise in the coming months due to “our relentless low supply-high demand imbalance.”

“Entering 2022, we had anticipated a strong first half, and moderating real estate markets thereafter. Call it ‘buyer fatigue’ or ‘easing demand,’ these periods of uncomfortably high home price appreciation do run their course. We are seeing the first signs of moderation in some regions, as more inventory is becoming available and competition eases slightly,” said Phil Soper, president and CEO of Royal LePage.

“The first quarter of the year was so strong, however, that we are bumping up our 2022 outlook.”


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The real estate company says the aggregate price of a home in this country rose more than 25 per cent year-over-year to $856,900 in the first quarter of 2022. Royal LePage says this is the highest gain on record since it began tracking such data.

Soper doesn’t believe the Bank of Canada’s move to hike its interest rate this month will have much impact on demand, compared to higher home prices.

“It is worth noting that most Canadians with higher loan to value mortgages have successfully passed the stringent federal requirements of the OSFI mortgage stress test – they have proven that they can manage significantly higher rate increases than we anticipate they will see,” he explained, noting the central bank is expected to continue increasing its rate through next year.

Meanwhile, the Canadian Real Estate Association says home sales fell 16.3 per cent in March, while prices were up 11.2 per cent compared with the same time last year — when they hit an all-time high.

The CREA notes the drop in sales came as the number of newly listed homes fell 5.5 per cent on a month-over-month basis in March.

According to Royal LePage, the national median process of a single-family detached home in Canada rose 26.7 per cent year-over-year to $906,100. The median price for a condo, meanwhile, was up 19.7 per cent to $612,900.

Despite high prices, Soper notes many properties are still getting multiple offers and selling above the asking price.

“There is a notable difference in buyer sentiment and behaviour today,” he said.

“Consumer confidence is being challenged as the lingering impact of the pandemic and worrisome geopolitical situation in Eastern Europe raises questions about the stickiness of inflation and the trajectory of interest rates. Yet, while there may be fewer bids on accurately priced properties, housing supply is so tight that multiple-offer scenarios remain the norm in most communities.”

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