November 2018 Market Intelligence

Big Dip in Sales Volume and Sales Prices in November! 
 

For those of you that have been receiving these monthly updates for a while now, you might notice a couple of tweaks to the graphs. I have added another column titled MOI which is short for Months of Inventory. Months of inventory is different than average days on the market. Months of inventory is how many months it would take to sell every house on the market based on the rate of sales against the total number of properties on the market. I have also added some colour to the data fields. The gradient fill rows signify when the Bank of Canada increased their interest rates. What’s interesting to note about these rate increases is that almost every month following the rate increases enjoyed higher sales volume and lower months of inventory, except for the last two in July and October which has more to do with the time of year (typically August is a very slow month every year and October is usually the last good month in the year). This October we may have pre-sold some of November’s would be buyers as there were many buyers who wanted to make sure they get their new properties at the lowest possible rates before the Bank of Canada increases it again. 

The latest BOC decision this December was to hold its rate at 1.75%. While it’s widely known by industry insiders that the BOC wants to get up to 2.5% eventually in order to curb inflation, the latest GDP numbers came in much lower than what had been trending previously which influenced the bank to hold firm.

10 year bond yield rates are becoming uncomfortably low in comparison to short term yields which may slow down the BOC rate increases.

My outlook for 2019 is that we will see solid volume growth and 5% price increase year over year.