{"id":3336,"date":"2021-12-16T20:47:35","date_gmt":"2021-12-17T01:47:35","guid":{"rendered":"https:\/\/canadianlending.ca\/investors\/?p=3336"},"modified":"2023-05-17T16:23:14","modified_gmt":"2023-05-17T20:23:14","slug":"cmis-state-of-the-market-canadas-housing-market-heats-up-again-as-prices-accelerate","status":"publish","type":"post","link":"https:\/\/staging.canadianlending.ca\/investors\/cmis-state-of-the-market-canadas-housing-market-heats-up-again-as-prices-accelerate\/","title":{"rendered":"CMI\u2019s State of the Market: Canada\u2019s Housing Market Heats Up Again as Prices Accelerate"},"content":{"rendered":"

 <\/p>\n

November was another active month for Canadian real estate, as home sales rose across the country and property values continued to accelerate. While the number of newly listed properties rose in November, a dearth of supply is likely to keep prices trekking higher in the short to intermediate term.<\/p>\n

 <\/p>\n

Home Sales Edge Up in November: CREA<\/strong><\/p>\n

National home sales rose 0.6% in November, with gains reported in Calgary, Edmonton, interior British Columbia and Saskatchewan, according to the Canadian Real Estate Association (CREA). Gains in these regions offset declines in the Greater Toronto Area and Montreal.<\/p>\n

 <\/p>\n

Inventories increased 3.3% in November, but that wasn\u2019t enough to ease the supply-demand imbalance in most major markets. As a result, the MLS Home Price Index increased by 2.7% compared with October and 25.3% year-over-year.[1]<\/sup><\/a><\/p>\n

\"\"<\/p>\n

Canadian home sales are accelerating again, with the trend holding well above the 10-year monthly moving average. | Source: <\/em><\/strong>CREA<\/em><\/strong><\/a><\/p>\n

 <\/p>\n

Home Prices Likely to Climb Higher into the Second Half of 2022 \u2013 RBC <\/strong><\/p>\n

Home values in Canada\u2019s largest markets accelerated again in the fourth quarter, driven by strong underlying demand and scarce inventories, according to RBC Economics. As RBC\u2019s Robert Hogue reported, annual home prices have risen sharply in Toronto, Vancouver, and the Fraser Valley.<\/p>\n

 <\/p>\n

\u201cWe believe much of the recent impetus in the market came from buyers front-running interest rate increases,\u201d Hogue said, referring to expectations that the Bank of Canada will soon begin the process of normalizing monetary policy in the wake of COVID-19. If RBC\u2019s expectations hold, price pressures will likely moderate by the second half of 2022.[2]<\/sup><\/a><\/p>\n

 <\/p>\n

Employment Levels Continue to Rise<\/strong><\/p>\n

Canada\u2019s labour market improved considerably in November, as employers added 154,000 workers to payrolls\u2014more than four times higher than analysts\u2019 expectations. With the gain, Canada\u2019s employment levels are now higher than in February 2020, which was the period before the first wave of pandemic restrictions came into effect.<\/p>\n

 <\/p>\n

The national unemployment rate declined to 6% in November, which was well below the consensus forecast of 6.6%. Before the pandemic, unemployment was at 5.7%.[3]<\/sup><\/a><\/p>\n

\"\"<\/p>\n

Canada\u2019s labour market has added jobs for six consecutive months. | Data Source: Statistics Canada<\/em><\/strong><\/p>\n

 <\/p>\n

Stock Market Correction Intensifies<\/strong><\/p>\n

Wall Street and Canadian stocks have declined sharply over the past month amid concerns that the new COVID-19 strain, known as Omicron, would further complicate reopening plans and put additional strain on the healthcare system. Expectations that the United States Federal Reserve will begin tightening its pandemic stimulus measures also weighed on investor sentiment after Fed Chairman Jerome Powell sounded the alarm on rising inflation.[4]<\/sup><\/a><\/p>\n

 <\/p>\n

After peaking above 21,760 on November 20, Canada\u2019s benchmark TSX Composite Index experienced a 6% correction – its biggest fall since late January – driven by a drop in energy stocks as concerns over a potentially vaccine-resistant variant pushed oil prices down. On Wall Street, the S&P 500, Dow Jones Industrial Average and Nasdaq Composite Index also pulled back sharply from record highs.<\/p>\n

\"\"<\/p>\n

The TSX Composite Index\u2019s V-shaped recovery fell short in early December. | Source: <\/em><\/strong>barchart.com<\/em><\/strong><\/a><\/p>\n

 <\/p>\n

Conclusion and Summary<\/strong><\/p>\n

With inflation raging at multi-decade highs, central banks in Canada and the United States are considering unwinding their pandemic stimulus measures sooner than expected, potentially opening the door to rate hikes in the not-too-distant future. The Bank of Canada forecasts its first rate hike could come as soon as April.[5]<\/a> <\/sup>Central bank rate hikes have an indirect impact on mortgage rates as financial institutions pass on these higher costs to consumers.<\/p>\n

 <\/p>\n

What Happens Next?\u00a0<\/b><\/p>\n

CMI Financial Group will continue to analyze market changes and keep you updated on a regular basis.\u00a0Learn more<\/a>\u00a0about investing in private mortgages.<\/p>\n

 <\/p>\n

<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

  November was another active month for Canadian real estate, as home sales rose across the country and property values continued to accelerate. While the number of newly listed properties rose in November, a dearth of supply is likely to keep prices trekking higher in the short to intermediate term.   Home Sales Edge Up … <\/p>\n

Continue reading “CMI\u2019s State of the Market: Canada\u2019s Housing Market Heats Up Again as Prices Accelerate”<\/span><\/a><\/p>\n","protected":false},"author":12,"featured_media":3643,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[87],"tags":[],"class_list":["post-3336","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-market-research"],"yoast_head":"\nCMI\u2019s State of the Market: Canada\u2019s Housing Market Heats Up Again as Prices Accelerate - Investors | Real Estate Secured Mortgage Investments<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CMI\u2019s State of the Market: Canada\u2019s Housing Market Heats Up Again as Prices Accelerate - Investors | Real Estate Secured Mortgage Investments\" \/>\n<meta property=\"og:description\" content=\"  November was another active month for Canadian real estate, as home sales rose across the country and property values continued to accelerate. 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