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Canadians were planning a flurry of real estate activity just a few months ago, but risk happens fast. The Bank of Canada (BoC) Survey of Consumer Expectations show households have planned less housing activity in Q3 2023. Despite a booming population, fewer people plan to buy or sell a home—or even move.
Fewer Canadians Are Thinking of Buying A Home
Fewer Canadian households are considering buying a home. The share of households planning to buy a home within 12 months fell 1 point lower to 12% in Q3 2023. During record population growth, it’s unusual to see fewer people buying a home. This is most likely indicative of the sky high prices limiting the ability to purchase.
The BoC added an additional data point to help break down this number—”newcomers,” a.k.a. recent immigrants. New arrivals were disproportionately high when it came to the share looking to buy (29%). However, the median income math for the demographic doesn’t quite make sense at such a high share. That may be a disappointing reality check.
More Canadians Plan To Stay Where They Are
Fewer households plan to move from their current digs within the next 12 months. The share of those that do fell 2 points to 19% in Q3 2023, a smaller but still healthy share. Newcomers were disproportionately represented, with 44% of these respondents planning to move. Not a surprise considering recent immigrants are more likely to have inadequate housing. Though once again, reality starts with expectations—but expectations don’t necessarily mean reality.
Fewer Canadians Are Considering Selling A Home, But Inventory Is Already Rising
Fewer Canadians are planning to sell, but reality disagrees on this point. The share of people planning to sell a home fell 2 points to 11% in Q3 2023. Newcomers with a home were once again overrepresented, with 27% planning to sell. The latter data point leaves so many unanswered questions—do they regret buying? Are they moving? It’ll forever be a mystery.
Consumer real estate expectations are cooling but this sentiment tends to lag. Rather than being a leading indicator, households tend to provide coincidental data. The market is already seeing more inventory and fewer buyers. It’s even reached the point of being the most supplied in over a decade. It’s been such a rapid shift, it’s even surprising Canada’s largest banks. At least two see even lower home prices going forward, and without a major shift—other banks are likely to follow.
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