The number of homes sold in London and the surrounding area took another fall last month.
According to the latest data from the London St. Thomas Association of Realtors (LSTAR), the number of homes sold in the area in August dropped by 34.8 per cent, when compared to sales from August 2021. LSTAR 2022 President Randy Pawlowski said this indicates a "soft landing" of the local real estate market.
"The softness seen over the last few months in the local real estate market was, undoubtedly, caused by the continuous rise in the mortgage interest rates, which has translated into higher borrowing costs," Pawlowski said. "This is encouraging, as it could signal a bit more support for the home selling prices in the coming months."
Keys to 607 homes exchanged hands last month, up by 93 units from July 2022, but 324 less compared to this time last year. Home prices also dropped slightly again in August, with an average sale price of $648,036. This number is still 5.2 per cent higher than August 2021's average price.
August marks the sixth consecutive month of decreased average sale prices locally. Pawlowski explained this is due to the continuous rise in mortgage interest rates, which has translated into higher borrowing costs.
The Bank of Canada is expected to announce another interest rate hike on Wednesday. Experts with the National Bank told the Toronto Star rates could go up by three-quarters of a percentage point.
This table shows average home sales prices in August 2022 for LSTAR’s main regions compared to benchmark prices. Table by LSTAR.
