Canada’s residential real estate market plunged dramatically last month, as the uncertainty surrounding COVID-19 pushed buyers and sellers to the sidelines.
Home sales fell by more than 56 per cent from the previous month’s level, which makes the month the worst April for home sales since 1984, the Canadian Real Estate Association said Friday.
Canada’s housing market is highly seasonal, as sales are generally low through the start of the year because of cold weather before heating up in the period from March to June. It then slows down again through the rest of the year.
But the COVID-19 pandemic has thrown those trends out the window, as lockdowns and physical distancing measures have put a chill on home buying right as the market normally tends to heat up.
“Like so many other parts of normal daily life, a lot of buying and selling activity in housing markets across Canada has been put on pause,” the CREA’s chief economist Shaun Cathcart said.
The CREA said it saw the trend begin in March, which started out strong before sales plunged in the latter half of the month. All in all, March sales were down by 15 per cent from February’s level. Now, April is almost 60 per cent below that record low.
Prices holding steady for now
The number of homes sold is in free fall, but so far average prices are not plummeting as sellers try to ride out the pandemic.
The average price of a home sold by a realtor last month was $488,000, down by 1.3 per cent from April 2019.
“While some downward pressure on prices is to be expected, the comparatively small change underscores the extent to which the bigger picture is one where so much activity on both the selling and buying side is currently on pause,” the CREA said.