It’s been a Triple-A/Goldilocks kind of housing market in Canada this year.
Ice cold. Sales plummet to near record lows as COVID-19 takes hold. “The dramatic plunge in activity in March and April turned out to be just a temporary pause,” says Robert Hogue, senior economist at RBC Economics.
Red hot. Sales soar to record highs as pent-up demand builds and markets re-opened. “The pent-up demand proved a powerful driver of activity,” says Hogue. “Buyers and sellers came running back this summer and quickly made up earlier declines. By August, the number of transactions to date in 2020 was back above year-ago levels, up 0.8 percent nationwide.”
Seasonal cooling. “We expect things to generally cool down later this fall but stay well out of the deep-freeze zone, provided the public health situation continues to allow the market to operate openly,” says Hogue. “Rock-bottom interest rates will provide substantial support. And the pandemic itself will generate higher than usual turnover in the market by altering the housing needs of many current owners, who are opting to move, something they might not have considered just a few months ago.
“In recent months, we’ve seen buyers expressing a stronger preference for single-detached homes and other types of low-rise dwellings. We expect this trend to persist. A higher turnover will stimulate both the supply and demand of housing.
“Tight demand-supply conditions in the majority of markets will keep the balance tilted toward faster price increases or slower price declines in Calgary’s case in the coming months.”