Summer market fails to make a splash

For the past 3 months, prices seem to have stabilized (ranging from $1.56M-$1.65M). It's interesting to note that prices today are higher than any point last year with the exception of last May and June. When looking at the first half of 2024, total transactions are almost 5% lower than 2023. There seem to be a lot more sellers testing the waters (new listings are up 12.3% vs. last year) but we still aren't seeing desperation in the market. The mindset of many sellers is that better days are yet to come. Not saying this is right or wrong but it's how many feel...

Underlying trends signal some cause for concern. The fact remains that we have a lot of inventory for this time of year. Buyers are being more picky and rightfully so, but sellers don't really seem eager to 'let go' of their properties either. We've actually had a few conversations with sellers recently where based on their goals, it just didn't make sense to put their property on the market. That doesn't mean that's the case for everyone. It really comes down to what you're looking to do. Keep in mind, tomorrow doesn't always mean things will be better.

Inventory continues its upward trend. We are now approaching 24,000 active listings. With sales hovering around 6,200 per month, this means only 1 in 4 listings will sell in a given month. This is starting to look more and more like a buyers market. The only thing preventing prices from falling (thus far) has been sellers and their willingness to hold onto their 'values'.

Inflation CPI came in at 2.7% which combined with a slowing economy should increase the odds of a Bank of Canada rate cut next week. Even if there is a rate cut, that doesn't mean that prices will jump. Supply (inventory) is significantly outpacing demand (sales) and the fact remains that any potential buyer today would likely opt for a fixed rate which would be significantly lower than variable (even after a few more rate cuts). The hope is that it changes buyer sentiment and gives consumers some more confidence to be more active and move the market into more of a balanced market.