A slight increase in national home sales activity has been recorded between July and August 2018, according to recent statistics from the Canadian Real Estate Association (CREA).
National home sales activity climbed 0.9 per cent from July to August 2018, marking the fourth consecutive monthly gain. However, sales activity is still below levels seen in most other months, going all the way back to early 2014.
About half of all local markets recorded a sales increase between July and August this year, led again by the Greater Toronto Area (GTA), along with increases in Montreal and Edmonton.
Actual (not seasonally adjusted) activity fell 3.8 per cent year-over-year in August 2018, largely due to declines in major urban centres in British Columbia.
“The new stress test on mortgage applicants implemented earlier this year continues to weigh on national home sales,” said Barb Sukkau, CREA president, in a press release. “The degree to which the stress test continues to sideline home buyers varies depending on location, housing type and price range.”
“Improving national home sales activity in recent months continues to obscure significant differences in regional trends for home sales and prices,” added Gregory Klump, CREA’s chief economist. “Moreover, recent monthly sales increases are diminishing, which suggests that the recent rebound may be starting to lose steam.”
The number of newly listed homes remained unchanged between July and August, as new supply increases in the Greater Vancouver Area (GVA) and Montreal made up for declines in the GTA and Winnipeg.
With the increase in sales and new listings unchanged, the national sales-to-new listings ratio crept up to 56.6 per cent in August, compared to 56.2 per cent in July. The long-term average for the sales-to-new listings ratio is 53.4 per cent. Based on a comparison of the sales-to-new listings ratio with the long-term average, approximately two-thirds of all local markets were balanced in August.
There were 5.2 months of inventory nationally at the end of August 2018, a result that is in line with the long-term average.
The Aggregate Composite MLS Home Price Index (MLS HPI) climbed 2.5 per cent on an annual basis in August 2018. Apartment units posted the largest annual price gains in August (+9.5 per cent), followed by townhouse/row units (+4.3 per cent). For freestanding homes, one-storey and two-storey single-family home prices remained relatively unchanged on a year-over-year basis in August (+0.4 and -0.4 per cent, respectively).
The 17 housing markets tracked by the MLS HPI, which now includes home prices in the Hamilton-Burlington and the Niagara Region, have seen varying trends. Home price gains are falling on a year-over-year basis in the Lower Mainland of B.C., where the GVA saw gains of 4.1 per cent, while the Fraser Valley saw increases of 10.7 per cent. Prices in Victoria climbed 8.5 per cent on an annual basis in August, while other regions on Vancouver Island experienced price increases of 13.6 per cent.
In the Greater Golden Horseshoe, home prices increased on an annual basis in Hamilton-Burlington (+7.2 per cent), the Niagara Region (+6.6 per cent), Guelph (+5.5 per cent) the GTA (+1.4 per cent) and Oakville-Milton (+1.2 per cent). Meanwhile, Barrie and District saw home prices drop 2.7 per cent on a year-over-year basis.
In the Prairies, benchmark home prices fell on a year-over-year basis in Calgary (-2.2 per cent), Edmonton (-2.1 per cent), Regina (-4.8 per cent) and Saskatoon (-2.3 per cent).
Ottawa saw home prices climb 7.1 per cent (led by an 8.2 per cent increase in two-storey single family home prices), while Greater Montreal saw prices increase by 5.9 per cent, led by a 6.3 per cent increase in two-storey single family home prices. Greater Moncton experienced price increases of 4.8 per cent, led by a 7.5 per cent increase in two-storey single family home prices.
The actual (not seasonally adjusted) national average price for a home sold in August 2018 climbed one per cent year-over-year to just over $475,500.
Once removing the GVA and GTA, two of Canada’s most expensive housing markets, from the equation, the national average price falls to just under $382,000.