As winter fades away, many are wondering what the spring housing market has in store. After a series of interest rate holds by the Bank of Canada, experts suggest that a rebound is on the horizon. However, don't expect a sudden surge just yet.
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The central bank is likely to maintain its key rate for now, but the direction it takes next remains uncertain. Some forecasts hint at modest rate cuts later in the year, possibly starting in June. This uncertainty may keep some buyers cautious during the spring months.
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TD Bank economist Rishi Sondhi describes Canada's housing market as a "coiled spring," waiting for a trigger like an interest rate cut to unleash pent-up demand, especially in Ontario and British Columbia.
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According to the Canadian Real Estate Association, February might have been the calm before the storm, with expectations of increased activity looming on the horizon. The Chair, Larry Cerqua, mentioned a feeling that things are about to pick up, leaving buyers to wonder whether they should wait for a signal from the Bank of Canada or spring listings.
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Realtor Dean Artenosi sees this moment as a turning point, suggesting that the worst is behind us. The consistent interest rate holds have boosted buyer confidence, signaling a return to a more normal market. This sentiment is echoed in the Greater Toronto Area, where multiple offers are becoming common again.
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Out West, activity cooled in March after a hot start in 2024. Vancouver real estate agent Tim Hill notes that many clients are waiting for rates to drop before making a move. However, some are considering buying before then to take advantage of expected price growth amid lower borrowing costs.
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RBC assistant chief economist Robert Hogue predicts a gradual rebound later in the year, particularly in markets like Calgary, which remain robust due to high demand and limited inventory.
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Despite pent-up demand, affordability remains a concern in major markets like Toronto, Vancouver, and Montreal. Hogue emphasizes the need for a significant drop in mortgage rates to sustain market activity.
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Artenosi advises against waiting, citing Canada's growing population and the potential for bidding wars. With the population surpassing 41 million in March, waiting for the perfect scenario might not be wise.
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In summary, while the spring housing market shows signs of stirring, uncertainty lingers. Buyers are advised to weigh their options carefully and consider factors beyond interest rates and market trends. The key takeaway: in a dynamic market, waiting might not always be the best strategy.