According to the Canadian Real Estate Association (CREA), May 2015 was the fourth consecutive month where Canadian home sales showed an increase over the previous month.
The MLS systems of Canadian real estate boards and associations processed 3.1 per cent more home sales in May 2015 compared to April, making home sales the strongest they have been in more than five years.
The Greater Toronto Area, Calgary, Edmonton, Ottawa and Montreal were the regions with the greatest sales increases, although sales were up from April in approximately 60 per cent of all local markets.
“CMHC announced in April that effective June 1, it was hiking mortgage default insurance premiums for homebuyers with less than a 10 per cent down payment, so some buyers may have jumped off the fence and purchased in May to beat the increase,” said Pauline Aunger, CREA president, in a press release. “It’s one of the factors that could have affected sales last month. That said, all real estate is local, with trends that reflect a combination of local and national factors.”
May 2015’s actual (not seasonally adjusted) sales activity was 2.7 per cent higher year-over-year, and 5.7 per cent higher than the 10-year average for the month. Sales grew on a year-over-year basis in approximately half of all local markets, especially in the Lower Mainland of British Columbia, Greater Toronto Area and Montreal.
“Sales in and around the Greater Toronto Area played a starring role in the monthly increase in May sales,” said Gregory Klump, CREA’s chief economist, in a press release. “At the same time, the rebound in sales over the past few months in Calgary and Edmonton suggests that heightened uncertainty among some home buyers in these housing markets may be easing.”
May’s national home sales statistics also showed that the number of newly listed homes decreased by 0.2 per cent compared to April, while the national sales-to-new listings ratio was 57.6 per cent in May, an increase from January’s 50.4 per cent. This number means the housing marking conditions are balanced. About half of local housing markets were balanced (between 40 and 60 per cent), while the GTA and markets in British Columbia indicated a buyers’ market.
The MLS Home Price Index (HPI) increased by 5.7 per cent year-over-year in May, up from 4.97 per cent year-over-year in April. Year-over-year price growth increased the most in Vancouver (up 9.41 per cent) and the GTA (up 8.9 per cent).
The national average price for homes sold in May was $450,886 (not seasonally adjusted), an increase of 8.1 per cent year-over-year. However, this number is skewed by the Greater Vancouver and Greater Toronto markets. If excluded, the national average is $344,988, a 2.4 per cent gain year-over-year.