Oct 20, 2014
The Canadian Real Estate Association (CREA) reported last week that Canadian existing home sales declined on a month-over-month basis in September for the first time since January. Volumes were down 1.4% from August’s figures but, on a year-over-year basis, September saw sales which were 10.6% above levels seen in September, …
The Canadian Real Estate Association (CREA) reported last week that Canadian existing home sales declined on a month-over-month basis in September for the first time since January. Volumes were down 1.4% from August’s figures but, on a year-over-year basis, September saw sales which were 10.6% above levels seen in September, 2013. On a year-to-date basis, through the first nine months of 2014, national sales volumes are about 5% higher than at the same point last year.
The national association of realtors says that inventories of listings of affordable homes are scarce in some markets while in others, sellers are holding firm on prices. CREA Chief Economist Gregory Klump commented that “momentum going into the fourth quarter is showing tentative signs of waning”. Low borrowing rates have been driving the market this year and Klump suggests that they will continue to do so, particularly in the country’s hottest markets.
New listings were down 1.6% from August and the national sales-to-new-listings ratio continues to creep upward, ending the month at 55.7% (August’s reading was 55.6%). A reading between 40% and 60% is considered to be “balanced”. Inventory levels (expressed as the time required for all listed homes to sell at the current sales rate) did rise slightly – to 5.9 months from 5.8 months in August. The inventory level held steady at 6 months through May, June and July.
The MLS Home Price Index, which adjusts for the mix of properties sold to provide valid comparisons between periods, was up 5.28% from a year ago. For two-story homes, it rose 6.52%, townhouses were up 5.51%, bungalows 5.07% and the index for apartments (condominiums) rose by 3.05%. The index reading for the big three markets was strong: Calgary advanced 10.11%, Toronto 7.82% and Vancouver’s index rose 5.26%. The average sale price of a Canadian home in September was $408,795, which represents a 5.9% increase from September, 2013. Excluding the two most expensive markets of Vancouver and Toronto, the average price of a home in Canada in September was $325,406.