Growing concerns over the global economic outlook and unsettled financial markets have contributed to a notable deterioration in consumer sentiment in recent months, and have moderated domestic retail sales activity. So far, however, this does not appear to have dented Canadians’ enthusiasm for real estate. Seasonally-adjusted MLS home sales  and Toronto Condos held steady in August, and are currently tracking in line with the average of the past decade.

Encouragingly, there is a decent pool of available listings in most major centres, which is promoting
balanced conditions and steady prices. The months’ supply of inventory stood at 6.2 in August, while the national ratio of new listings to sales was 1.94, both little changed since April and consistent with a balanced market. Meanwhile, average prices were also little changed on a month-to-month basis for the sixth consecutive month.

Historically low interest rates remain a powerful draw in the interest-sensitive housing sector, and should maintain a healthy level of sales in the months ahead. Yet, heightened economic uncertainty combined with recent signs of a loss of momentum in Canada’s jobs market could keep some potential first-time and move up buyers on the sidelines for the time being. On balance, we anticipate a modest slowdown in the volume of sales transactions heading into year end. With balanced market conditions in most parts of the country, look for fairly stable prices.