Hikes in the key rate are starting to stabilize the housing stock, as buyers are becoming more cautious before buying a house.
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“When interest rates rise, the cost of financing increases. I would tell you that some of it was already anticipated, but it’s a surprise today with the 1% increase in the key rate,” said Royal LePage real estate broker Marc Lefrançois.
The slowdown in the market, marked by the rise in inflation, the key rate, but also the summer season, favors properties whose cost is approaching $300,000.
The overbidding is still present for houses considered “affordable”, between 150,000 to 250,000 $.
The number of listings on the housing stock has increased, while requests have decreased.
In Rimouski, sales are down 26 per cent compared to last year, while the median house price continues its meteoric rise. In 2019, the price was $195,000. In 2021, it climbed to $264,000 to end at $305,000.
Constantly rising prices cause a lot of problems, especially for first-time buyers.
The Canada Mortgage and Housing Corporation (CMHC) expects home prices to fall by 5% in 2023, if demand continues to slide.
“Until the offer is higher, the problem will not be solved. It will not be enough when you return from vacation, ”added another broker, Mélanie Bergeron.
Note that the key rate reached 2.5% on Wednesday.
