Canada's Real Estate Market Shaken: Condo Sales Drop in Most Major Cities

Get the latest update on Canada's real estate market as condo sales drop in major cities. Find out the reasons behind this decline and its impact on the industry.

Canada's real estate market is facing another blow as condominium sales display signs of slowing down in most of the country's major markets, according to a recent report from Re/Max. The report, released on Tuesday, reveals that although condo sales surged between May and August of this year, they still pale in comparison to the year-to-date sales of 2022. In fact, condo sales have declined in all but two of Canada's seven largest markets. In Calgary, Alberta, condo sales witnessed a growth of 22 percent in the first eight months of 2023, while in Edmonton, Alberta, they increased by three percent year-over-year.

Canada's Real Estate Market Shaken: Condo Sales Drop in Most Major Cities | ogusyis

However, it is a different story for other major markets. Vancouver, British Columbia, and Ottawa, Ontario, experienced a significant drop in sales transactions, with a decline of 17 percent. Toronto also recorded a notable slump of 12.8 percent in condo sales, while Fraser, British Columbia, and Halifax, Nova Scotia, observed drops of 10.3 percent and 3.6 percent respectively. For instance, Vancouver saw a sale of only 10,100 apartments between January and August 2023, a decrease from the 12,159 apartments sold during the same period in 2022. Similarly, Toronto, which boasts Canada's biggest condo market, sold 18,264 apartments compared to last year's 20,948 during the same timeframe.

The decline in condo sales can be attributed to several factors. In British Columbia cities and Ottawa, higher borrowing costs have had an impact on sales. On the other hand, Alberta has witnessed an increase in interprovincial migration due to its lower cost of living, which has led to more buyers in the market. Amidst all this, the Bank of Canada decided to maintain its key interest rate at five percent in September. However, previous months have seen consistent interest rate hikes, which have left many Canadians concerned about future increases and overall affordability. Re/Max president Christopher Alexander emphasized this sentiment in a news release.

In conclusion, the real estate market in Canada is grappling with a downturn in condo sales across most of its major markets. While some cities experienced slight growth, the overall trend shows a decline in sales transactions. Factors such as higher borrowing costs and interprovincial migration have contributed to the varied performance in different markets. With continued uncertainty surrounding interest rate hikes and overall affordability, Canadians remain cautious about the future of the real estate market.