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Evidence from 6 Charts Indicates a Decline in Canadian Real Estate Market (2024)

Hello again and welcome back, everyone! Thank you for tuning in as always. This week, I’m going to show you six charts that indicate the Canadian real estate market is in decline. It’s a topic that’s been on the minds of many real estate professionals and homeowners lately, with concerns about new listings, inventory, and debt loads mounting.

Let’s dive into the data. The first chart shows the sales to new listings ratio, which gives us a snapshot of the market’s health. Currently, we’re in a balanced market, but the ratio for April is the worst it’s been in the last five years. This downward trend is not a good sign for the market’s overall stability.

Moving on to chart number two, we see a decline in the number of sales for April compared to previous years. This downward trend has been consistent since 2021, despite a growing population. This suggests that per capita sales are at their lowest levels on record.

Chart number three shows the months of inventory or supply, which has been increasing steadily since reaching all-time lows in 2021 and 2022. This trend indicates a growing imbalance between supply and demand in the market.

Chart number four further highlights the increasing supply of homes on the market, with April’s months of supply trending upwards since 2021. This suggests that we may soon reach a four-year high in inventory levels.

One interesting point raised by a real estate expert on a recent TV show is the concern over a surge in condo supply in the Greater Toronto Area. He advised caution for condo investors, warning that the market is becoming dangerously saturated with listings.

Chart number five shows a year-over-year decline in the national average price for the first time in 12 months. This suggests that we may see a continued decline in prices in the coming months.

Lastly, chart number six analyzes the national average residential sale price in Canada, showing that we are currently 20% above the long-term mean line. This indicates that a correction to the mean line could result in a significant price drop.

Overall, these charts paint a concerning picture of the Canadian real estate market’s health. It’s important for homeowners and investors to stay informed and cautious in these uncertain times. Let me know your thoughts in the comments, and I’ll see you next week for more updates.

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