Home sales crater in Huron-Perth as buyers wait for more interest rate cuts

Home sales in the region dropped to their lowest levels in more than 20 years for September as potential buyers waited for interest rates to continue falling.

Home sales in the region dropped to their lowest levels in more than 20 years for September as potential buyers waited for interest rates to continue falling.

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The Huron Perth Association of Realtors said 128 homes were sold last month, a drop of almost 13 per cent from 2023.

“There’s been no shortage of new supply coming on the market as sellers are anxiously awaiting the return of buyers to the market, but the recovery hasn’t materialized yet as buyers seem to be waiting for rates to fall even further before coming back in, ” Huron Perth Association of Realtors president Teresa Ondrejicka said.

“As a result, overall inventories have topped out for the time being as the acceleration in new listings has pulled back with the realization that there aren’t many offers being met right now.”

Sellers listed 302 homes last month, a slight decrease from the same period in 2023 but well above five- and 10-year averages. That, coupled with a stagnant market, left 840 homes for sale at the end of the month – up about 27 per cent from the end of September 2023 and the most for the month in more than five years.

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Months of inventory numbered 6.6 at the end of September 2024, up from the 4.5 months recorded at the end of September 2023 and above the long-run average of 3.4 months for this time of year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

Those who did buy a home last month paid an average of $621,704, almost the same as September 2023. For the year, sellers are getting $621,584, a slight decline of almost two per cent from the first nine months of 2023.

The benchmark price – the value of a “typical” home in a community, based on the most popular combination of features – for single-family homes last month was $578,600, up 1.1 per cent on a year-over-year basis. By comparison, the benchmark apartment price was $488,900, falling 1.7 per cent from year-ago levels.

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Local figures bucked the national trend, as home sales jumped almost two per hundred last month following the Bank of Canada’s third straight interest rate cut.

“Sales gains are now three-for-three in the months following interest rate cuts, which is a trend even though the increases weren’t headline-grabbing,” CREA senior economist Shaun Cathcart said. “That said, with the pace of rate cuts now expected to be much faster than previously thought, it’s possible some buyers may choose to hold off on a purchase for now. This could further boost the rebound expected in 2025 at the expense of the last few months of this year.”

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