Zillow is sounding the alarm on surging Treasury yields as the 30-year Treasury hits its highest level in nearly 20 years. Higher Treasury yields are keeping mortgage rates elevated as the U.S. housing market already faces weak buyer demand, rising inventory, falling list prices, and some of the lowest home sales in decades. But mortgage rates might not be the real problem. Home prices remain historically expensive compared to household incomes, with the national home value-to-income ratio around 4.3 versus a long-term average closer to 3.5. Until that affordability gap closes, home buyers could remain on the sidelines even if mortgage rates eventually decline. Here is a direct video link.
With a median Canadian home price-to-household-income ratio of 8.9x nationally (versus 4.3x in America), Canada’s housing bubble says, ” Hold my beer…
Canadian home sales fell to about 37,000 in August, down 7% year over year and 0.7% from July, marking the slowest August in at least 23 years and even weaker on a per-capita basis despite population growth. The slowdown is broadening beyond Ontario and B.C., with declines in Alberta (-11.5%), Quebec (-7.3%), New Brunswick (-8.7%), and softer volume even in Saskatchewan amid major investment news. Nationally, new listings rose 3.3% while sales fell, pushing the sales-to-new-listings ratio down to 49.1% and favouring buyers. Here is a direct video link.
