Royal LePage expects sidelined buyers to re-engage this quarter ahead of expected rate cuts by the Bank of Canada.
National aggregate home price increased 4.3% year over year in Q4 2023; decreased 1.7% quarter over quarter. Aggregate home price in greater regions of Toronto, Montreal and Vancouver posted gains of 5.1%, 4.1% and 2.7% year over year, respectively, in final quarter of 2023.
Among report’s major regions, Calgary recorded highest year over year price appreciation (10.7%); only major region to post quarterly price gains in Q4 2023 (1.5%over Q3).
81% of regional markets posted a quarter over-quarter decline. Approximately 2.2 million mortgages in Canada will be renewing over the next two years, most at a much higher interest rate. National aggregate home price expected to rise 5.5% year over year in Q4 of 2024.
The aggregate price of a home in Greater Vancouver increased 2.7 per cent to $1,220,100 year over year inthe fourth quarter of 2023. On a quarterly basis, the aggregate price of a home in the region remained relatively flat, decreasing by 0.7 per cent. Broken out by housing type, the median price of a single family detached home increased 5.4 per cent year over year to $1,731,900 in the fourth quarter of 2023, while the median price of a condominium increased 4.2 per cent to $762,600 during the same period.
“The last few months of 2023 concluded much as expected: a generally quiet period but not without some last-minute transactions being completed before the end of the year. Overall, sales activity and prices in the fourth quarter were consistent with the fall, and despite the typical seasonal slowdown, home prices in Greater Vancouver have remained stable,” said Randy Ryalls, general manager, Royal LePage Sterling Realty. “There remains a significant amount of pent-up demand from homebuyers waiting to return to the marketplace. It’s simply a question of when, a factor that hinges on the trajectory of lending rates.”
In the city of Vancouver, the aggregate price of a home increased 3.4 per cent year over year to $1,391,700 in the fourth quarter of 2023. During the same period, the median price of a single-family detached home increased 8.1 per cent to $2,244,200, while the median price of a condominium increased 5.5 per cent to $827,900.
“Looking ahead, we could see a brisk spring market, especially if fixed-rate loans continue to trend downward. This will spur significant activity,” noted Ryalls. “If we see the Bank of Canada begin to cut interest rates early in the year, competition among buyers could heat up quickly.”
Ryalls added that a significant boost in inventory will be needed to meet the demands of buyers coming off the sidelines. In December, Royal LePage issued a forecast projecting that the aggregate price of a home in Greater Vancouver will increase 3.0 per cent in the fourth quarter of 2024, compared to the same quarter in 2023.