Real estate market easing as 'buyer fatigue' sets in
After dramatic month-over-month increases in both the number of housing sales and prices in Canada for the past few months, sales finally dropped in April.
“It may be an early sign some buyers are reaching their limit to engage in bidding wars,” states a report issued by RBC Economics that was released May 17. ”Soaring property values have significantly raised the bar for those contests.”
It shows a 12.5 per cent drop in the number of sales nationally from March to April.
Benchmark prices, at the same time, climbed 2.4 per cent, or $17,000 for the month. They’re up, nationally, $135,000 over the same time last year.
Re/Max Kelowna realtor Colin Krieg said much the same thing in a news release last week. He found that Re/Max realtors had written half as many offers last week as they did a month earlier.
“What’s causing all this?” Krieg asked in a video accompanying the release. “It could be buyer fatigue. It can be exhausting being out there, competing with other offers and having your heart broken just to do it all over again.”
Still, with a shortage of new listings in the area, most homes put on the market sell quickly with 68 per cent of apartments listed in Kelowna selling in April, 86 per cent of townhouses and 88 per cent of single-family homes.
While Krieg noted that part of the slowdown may be due to B.C.’s travel restrictions, the RBC report suggests the upward trend in sales just wasn’t sustainable.
“It wasn’t a surprise to see Canadian home resales decline 12.5% in April,” the RBC report stated. “After successively setting new record highs through the fall and initial months of 2021, they had little upside left. And unusually strong winter activity likely altered the traditional seasonal pattern, bringing forward activity that would have taken place in the spring.”
The full RCB report can be seen here.
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