As home sales decrease for the fifth straight month, home buyers and sellers are "playing the waiting game."

Between June and July, home sales decreased for the fifth straight month, according to the Canadian Real Estate Association, but this latest decline was the smallest of the five.

According to the association, sales in July decreased 5.3% from June on a seasonally adjusted basis. When compared to July of last year, the actual number of sales last month was 37,975, a 29% decrease.

"Without adjustments, July sales were the lowest since the financial crisis in 2020."

The month-over-month sales decline in July was the smallest of the previous five months. Market observers stated that it is too early to predict whether this trend will persist.

Though bidding battles were the norm last year and early this year, analysts and CREA chair Jill Oudil said it is a continuation of the market cooling.

The Bank of Canada raised its benchmark interest rate by one percentage point to 2.5% in July, the greatest increase the nation has experienced in 24 years, which is largely responsible for the slowdown.

The impact on purchasing power is often mirrored by changes in mortgage rates.

Many purchasers have remained on the sidelines as rates have increased and sales have declined, believing better offers will emerge in the fall and upsetting sellers who have to accept the fact that their homes probably won't sell for as much as neighbours who sold in the winter.

According to Davelle Morrison, a Toronto broker at Bosley Real Estate Ltd., "There are definitely a lot more people waiting until September before they offer properties and they're trying not to list in August, if they can help it."

As a result, there were 73,436 new listings in total in July, which is 6% fewer than in July of previous year and, when adjusted for season, 5% fewer than in June.

People might buy before selling their own house earlier this year when homes were flying off the market with minimal risk of their property not selling.

Because properties are remaining vacant for such a lengthy time, Morrison is now advising clients to sell their residence first.

The national average price is reduced by $104,000 when the Greater Vancouver and Toronto Areas are excluded from the calculation.

According to Kavcic, the declines are part of a market correction that is "nearly everywhere, but to varied degrees" in progress.

With markets like Kitchener-Waterloo and London down around 15% from their highs, he claimed that Southwestern Ontario is suffering the most.

He has seen that prices in Montreal have dropped over the past two months but have not been as affected by the downturn as they have been in Vancouver, where decreases have already occurred for four straight months.

This report by The Canadian Press was first published Aug. 15, 2022.

Source By: CTVNews.Ca