Toronto, one of the biggest drivers of activity Photo: Bob Linsdell

Canadian home sales continued to fall in June 2016, but prices keep on climbing.

The number of homes trading hands via Canadian MLS systems fell 0.9 per Cent from May 2016, according to the latest figures from the Canadian Real Estate Association. This is the second monthly decline in a row, taking sales activity down to 2.6 per cent below the record set in April 2016.

Sales activity was down from the previous month in about half of all markets in June, with declines in Greater Vancouver, the Fraser Valley and Greater Toronto having eclipsed gains in comparatively less active housing markets.

“As was the case in May, the monthly decline in national sales activity was led by the Lower Mainland of British Columbia and markets in or around the GTA. In keeping with the law of supply and demand, exceptionally low inventory combined with high demand continues to translate into strong price growth in these housing markets, where year-over-year price gains have been running in double-digit territory since late last year,” says Gregory Klump, CREA’s Chief Economist.

Actual (not seasonally adjusted) sales activity was up 5.2 per cent year-over-year in June 2016. Year-over-year increases have been steadily losing momentum since February 2016.

The number of newly listed homes rose by 2.2 per cent in June 2016 compared to May. New supply climbed among a broad majority of all local markets, led by Greater Toronto, Oakville-Milton, Montreal, Quebec City, and B.C.’s Fraser Valley. The return of activity in Fort McMurray following its evacuation in May also contributed to the national increase in new listings.

With sales down and new listings up, the national sales-to-new listings ratio eased to 63.3 per cent in June 2016, compared to 65.3 per cent in May.

Nonetheless, the Aggregate Composite MLS Benchmark price rose by 13.6 per cent year-on-year to $564,700 in June 2016, the biggest gain since December 2006. For the fifth consecutive month, y-o-y price growth accelerated for all property types.

While prices in 9 of the 11 markets tracked by the MLS HPI posted annual gains in June, though, price growth continues to vary widely among housing markets.

“While national sales activity remains strong, there are still significant differences in housing market trends across Canada,” says CREA President Cliff Iverson. “While home sales activity and price growth are running strong in B.C. and Ontario, they remain subdued in other markets where homebuyers are cautious and uncertain about the outlook for their local economy.”

Greater Vancouver (up 32.1 per cent) and the Fraser Valley (35.5 per cent) posted the largest annual gains, followed by Greater Toronto (16 per cent), Victoria (15.7 per cent), and Vancouver Island (10.6 per cent). By contrast, prices were down 4.1 per cent and 1.4 per cent year-on-year in Calgary and Saskatoon, respectively.

Home prices gained further traction in Regina (3.6 percent), Greater Montreal (1.9 per cent), and Ottawa (1.0 per cent). Home prices in Greater Moncton recorded their eleventh consecutive year-over-year gain, rising 7.9 per cent.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets. The actual (not seasonally adjusted) national average price for homes sold in June 2016 was $503,301, up 11.2 percent y-o-y.

If these two housing markets are excluded from calculations, the average price is a more modest $374,760 and the gain is trimmed to 8.4 per cent.

Canadian home sales drop after record-breaking April

16th June 2016

Canadian home sales slipped in May 2016, following a record-breaking April.

The number of homes trading hands fell 2.8 per cent month-on-month in May 2016, according to the Canadian Real Estate Association. Sales activity dropped in May from the previous month in 70 per cent of all markets, led by those in British Columbia and Ontario, where the number of homes listed for sale has fallen to multi-year or all-time lows.

“National sales activity is still strong, even after coming off the record levels of the past couple of months,” says CREA President Cliff Iverson. “But, there are housing markets where sales continue to reflect a cautious mood among homebuyers and uncertainty about the local economy. All real estate is local, and REALTORS® remain your best source for information about sales and listings where you live or might like to in the future.”

“Many of the housing markets in BC and Ontario that led the monthly decline in national sales are also places where months of inventory have fallen to all-time lows,” says Gregory Klump, CREA’s Chief Economist. “This suggests a lack of supply may be starting to rein in sales amid a continuation of strong housing demand.”

Canadian property market has busiest ever April

24th May 2016

Canadian home sales have broken another record, following the market’s most active April ever.

Actual (not seasonally adjusted) sales activity rose 10.3 per cent from one year ago to shatter all previous records for the month of April, according to the Canadial Real Estate Association, as well as marking the second highest level for transactions for any single month.

The number of homes trading hands via Canadian MLS systems rose by 3.1 per cent month-over-month, with transactions up in about 70 per cent of all local markets – led by the National Capital Region and Edmonton. Following small declines in the previous month, activity held steady in the Greater Toronto Area (GTA) and edged lower in Greater Vancouver.

“Nstional home sales set new monthly records over the past two months, even as activity in Greater Vancouver and the GTA appears to have topped out,” says CREA President Cliff Iverson. “With almost three-quarters of all local markets posting sales gains in April, there are plenty of other places where sales are climbing as we head into the busiest time of the year for homebuyers.”

“Supply shortages and tight housing market conditions have become self-reinforcing in the GTA,” adds Gregory Klump, CREA’s Chief Economist. “The Greater Vancouver Area appears to be heading in that direction too. While significant home price gains may entice some homeowners in these markets to list their home for sale, the issue for many is that the decision to move means they would also be looking to buy while competition for scarce listings is fierce. As a result, many homeowners are deciding to stay put and continue accumulating capital gains.”

Canadian home sales hit record high

18th April 2016

Home sales in Canada have hit a record high this March, as the housing market springs forward.

Transactions rose 1.5 per cent month-on-month across the country, according to the Canadian Real Estate Association. 60 per cent of regions saw sales climb, including Victoria, Chilliwack, the Okanagan Region, Edmonton, Calgary, Woodstock-Ingersoll, Kingston, Barrie and Montreal, offsetting a decline of 0.3 per cent in Greater Vancouver and 1.8 per cent in the Greater Toronto Area.

Overall, activity climbed to an all-time high for March, with actual (not seasonally adjusted) sales up 12.2 per cent compared to March 2015. Even Canada and Toronto’s slightly declining markets remained near the record highs reached the month before.

“Greater Vancouver and the GTA are heading into the spring home buying season with soaring demand and a shortage of listings,” says CREA President Cliff Iverson. “Meanwhile, other major urban markets in Canada are well balanced or are amply supplied.”

“Single family home sales in the Lower Mainland of BC and the GTA set new records for the month of March in the range between a-half and one-million dollars – as did sales above a million dollars,” adds Gregory Klump, CREA’s Chief Economist.

“Meanwhile, sales below a half-a-million dollars, which were not subject to recently tightened mortgage regulations, are being increasingly restrained in these markets by a short supply of listings. If current sales and listings trends persist, price gains may pick up further this spring.”

Prices are already climbing, fuelled by the growing demand, with the CREA’s house price index rising 9.1 per cent year-on-year, the biggest gain recorded since June 2010.

Canadian home sales rise for second month in a row

16th March 2016
Canadian home sales have risen for a second month in a row this year, but the data hides an unbalanced market.

New figures from the Canadian Real Estate Association show that the number of homes trading hands via Canadian MLS Systems rose by 0.8 per cent in February 2016 compared to January.

The monthly increase lifted national sales activity to the highest level since June 2007.

The figures highlight the growing imbalance in Canada’s housing market, as Toronto and Vancouver continue to drive activity. Indeed, a greater number of local housing markets posted a monthly decline in sales activity than posted a monthly increase, but the latter accounted for a larger share of national transactions.

The Greater Toronto Area, Okanagan Region and Fraser Valley made the largest contribution to the monthly increase in national sales activity, offsetting monthly sales declines in Edmonton, Greater Moncton and Montreal.

“Two of Canada’s hottest housing markets look set to stay that way heading into the spring home buying season,” says CREA President Pauline Aunger. “Meanwhile, other major urban markets elsewhere in Canada are well balanced or have ample supply.”

Actual (not seasonally adjusted) sales activity rose 18.7 per cent on a year-over-year basis in February 2016, standing 12.7 per cent above the 10-year average for the month. Activity increased above year-ago levels in February in about three-quarters of all local markets. B.C.’s Lower Mainland, the GTA and Montreal contributed most to the year-over-year increase in national activity.

To highlight the uneven nature of the market’s performance, the CREA data also highlights that the number of single family home sales above one million dollars is rising in Greater Vancouver and the GTA.

“Tightened mortgage regulations apply to homes selling above five hundred thousand dollars and below a million dollars. The tighter regulations combined with a short supply of single family homes will restrain transactions below one million dollars,” comments Gregory Klump, CREA’s Chief Economist. “If recent trends continue, home sales above one million dollars will account for a greater share of activity and will further fuel year-over-year average price increases in these markets. Meanwhile, price growth will remain more modest in other housing markets that don’t have an ongoing or developing supply shortage like the kind we’re seeing in the Lower Mainland of British Columbia or around the GTA.”