National housing market in 'holding pattern' as buyers patient for lower rates: CREA

The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely "stuck in a holding pattern" despite borrowing costs beginning to come down.

The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely "stuck in a holding pattern" despite borrowing costs beginning to come down.

The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.

On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.

"With ever more friendly interest rates now all but guaranteed later this year and into 2025, it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well-behaved in most of the country," said CREA senior economist Shaun Cathcart in a press release.

The association's chair James Mabey added that the first week of April, May, June and September typically see a burst of new supply that can jolt the market.

This year, the Bank of Canada also announced its third consecutive cut to its key interest rate during the first week of September, which Mabey said could help lure buyers off the sidelines.

The central bank reduced its key lending rate by a quarter-percentage point to 4.25 per cent. Economic forecasts say the central bank will likely continue cutting its key lending rate by a quarter-percentage point until July 2025, bringing it down to around 2.5 per cent by that time.