Despite a boost in condominium sales from May through August, a new report from RE/MAX Canada says that year-to-date sales were “no match” for 2022’s levels.
The report — it examines close to 100 communities across the Greater Toronto Area, Greater Vancouver, the Fraser Valley, Calgary, Edmonton, Ottawa, and Halifax-Dartmouth — reveals that condo sales slipped in all but two markets when comparing the first eight months of 2023 to the same time in 2022.
In Calgary, sales saw a dramatic, year-to-date rise of 22%. In Edmonton, the increase was nominal, at just 3%.
Meanwhile, condo prices held steady in Greater Vancouver, Calgary and Halifax-Dartmouth — however, they slipped in the Greater Toronto Area, the Fraser Valley, Edmonton, and Ottawa.
“Higher borrowing costs, combined with the minimum qualifying rate of 2% added by the stress test, contributed to lower condominium market share in three of the seven markets, including Greater Vancouver, Fraser Valley, and Ottawa,” says Tuesday’s report.
Christopher Alexander, President of RE/MAX Canada, adds that while the condo market rallied in September following the Bank of Canada’s rate pause, the most recent inflation numbers “extinguished the flame.”
"Lifecycle sales will continue to contribute to steady activity, but a comeback similar to that of the second quarter is likely out of the question,” says Alexander.
Going forward, says RE/MAX, a further slowdown is on the horizon as Canadians continue to grapple with affordability amid higher rates.
"We do anticipate a softer end to the year, as economic conditions erode buying power and impact consumer confidence," says Elton Ash, Executive Vice President for RE/MAX Canada.
"The signs are already evident with inventory building and new projects being delayed or cancelled. Savvy buyers will find some opportunity in larger markets, and although some further softening in values is anticipated in most centres, the impact will be somewhat tempered by the tight rental market and continued population growth. Look for condominium sales to rebound in the second or third quarter of 2024, as quantitative tightening eases, reinvigorating home-buying intentions."