Canadian home sales edge higher in April

According to statistics released today by The Canadian Real Estate Association (CREA), national resale housing activity edged up by less than one per cent in April 2012. Highlights: Home sales up 0.8% from March to April. Actual (not seasonally adjusted) activity stood 11.5% above levels in April 2011. The size of the year-over-year increase reflects a slowdown in sales last April following changes to mortgage rules which came into effect on March 18, 2011. The number of newly listed homes edged back 0.2% from March to April. While still well balanced, the combination of stable new listings and slightly higher sales activity resulted in a tighter national housing market. The national average home price edged up 0.9% on a year-over-year basis in April. Sales over MLS® Systems of real estate Boards and Associations in Canada edged up 0.8 per cent from March to April 2012, putting them on par with levels reported in the same month two years earlier. Activity was either up or held steady in half of all local markets in April, with Toronto and Calgary posting the biggest monthly increases for the second month in a row. Activity gains in Montreal, Winnipeg, Edmonton, as well as London and St. Thomas also made significant contributions to the national sales increase in April. Increased activity in these markets offset monthly declines in Ottawa, Windsor-Essex, Quebec City, the Fraser Valley, and Vancouver. “A number of Canadian housing market trends in April remained intact from the previous month,” said Wayne Moen, CREA President. “Trends in Vancouver and Toronto continue to diverge. These two housing markets have an obvious influence on national statistics and a high profile, but Canada is a big place. Trends in housing markets differ across Canada, and as all housing is local, buyers and sellers should speak to their local REALTOR® to better understand current and prospective trends where they live.” Actual (not seasonally adjusted) activity stood 11.5 per cent above levels in April 2011, reflecting the slowdown in sales following changes to mortgage regulations that came into effect in March of last year. A total of 157,804 homes have traded hands so far this year, up 6.4 per cent from levels reported in the first four months of 2011 and about four per cent above both the five- and 10-year averages for sales during the first third of the year. The number of newly listed homes was little changed in April compared to March, having edged back 0.2 per cent on a month-over-month basis. The number of markets in which new listings rose (45) ran almost even with those where new listings eased (54). The national housing market tightened marginally in April due to higher sales and stable new listings, but remains firmly entrenched in balanced market territory. The national sales-to-new listings ratio, a measure of market balance, stood at 55.9 per cent in April, up slightly from its March reading of 55.4 per cent. Based on a sales-to-new listings ratio of between 40 to 60 per cent, the number of local markets that were in balanced market territory in April (59) was up slightly from March (56). Nationally, the number of months of inventory stood at 5.6 months at the end of April, unchanged from levels reported in March. The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is a further measure of the balance between housing supply and demand. The actual (not seasonally adjusted) national average price for homes sold in April 2012 was $375,810, up 0.9 per cent from the same month last year. While more or less flat compared to last spring on a national basis, average sale prices were up on a year-over-year basis in 80 per cent of all local markets in April. “It bears repeating that the national average price was skewed higher last spring by record level high-end home sales in Vancouver’s priciest neighbourhoods, and that a replay of this phenomenon was not expected this year,” said Gregory Klump, CREA’s Chief Economist. “Sales data confirm that high-end activity in Vancouver is well off the peak levels reached at this time last year, which is exerting a gravitational pull on the national average price.” “By contrast, activity in Toronto is stronger this spring than it was last spring. Higher-priced sales activity there is on the rise and buoying average prices. As the most active housing market in Canada, Toronto is the biggest factor supporting national average price.” “Netting Vancouver out of the national average price calculation yields a 4.9 per cent year-on-year gain. Netting Toronto out of the national average price calculation, while leaving Vancouver in, produces a 2.2 per cent year-on-year decline. Netting out both Vancouver and Toronto results in a 3.1 per cent increase in average price. On balance, this points to modest price growth amid balanced market conditions in much of the rest of Canada.” Copyright CREA Reprinted with permission