Canadian home sales increased by a modest 2.1 per cent between August and September 2017, according to statistics from the Canadian Real Estate Association (CREA). Despite this increase, home sales were still down on a year-over-year basis. September’s home sales build on a smaller increase seen in August home sales, but still remains 12 per cent below the record set in March of this year.
Activity was up between August and September in about half of all local markets, led by Greater Vancouver and Vancouver Island, the Greater Toronto Area, London and St. Thomas, and Barrie. In the Greater Golden Horseshoe region, some markets posted sales gains between August and September, while others had activity that remained near recent levels or fell further.
Actual (not seasonally adjusted) activity fell 11 per cent compared to September 2016. Sales were down on an annual basis in nearly three-quarters of all local markets, let by the GTA and nearby housing markets.
“National sales appear to be stabilizing,” said Andrew Peck, CREA president, in a press release. “While encouraging, it’s too early to tell if this is the beginning of a longer-term trend. The national result continues to be influenced heavily by trends in Toronto and Vancouver but housing market conditions vary widely across Canada.”
“Further tightening of federal regulations aimed at cooling housing markets in Toronto and Vancouver risks creating collateral damage in markets elsewhere in Canada,” added Gregory Klump, CREA chief economist. “It also jeopardizes Canadian economic growth, which is already showing signs of fading.”
The number of newly listed homes recovered by 4.9 per cent between August and September 2017, following three consecutive months of declines. The national result was largely due to the increase in new supply in the GTA.
Since the increase in new listings surpassed the increase of home sales in September, the national sales-to-new listings ratio fell to 55.7 per cent, compared to 57.2 per cent in August. This indicates a balanced national housing market. Based on a comparison of the sales-to-new listings ratio with its long-term average, about two-thirds of all local markets were in the balanced range in September 2017.
At the end of September 2017, there were five months of inventory on a national basis, which is unchanged compared to August and is generally in line with the long-term average for the measure.
The MLS Home Price Index rose by 10.7 per cent year-over-year in September 2017, representing a further slowdown in year-over-year gains since April. This is due, in large part, to softening price trends in the Greater Golden Horseshoe markets that are tracked by the index.
Price gains slowed in September among ground-level benchmark homes and accelerated slightly for apartment units.
The price of apartment units increased by 19.8 per cent year-over-year, the largest gain across all home types. This was followed by townhouse/row units (up 13.5 per cent), single-storey single family homes (up 7.9 per cent) and two-storey single family homes (up 7.2 per cent).
Although price trends continue to vary widely by region, benchmark home prices increased on an annual basis in all 13 markets tracked by the MLS HPI, which has not happened in nearly seven years.
The actual (not seasonally adjusted) national average price for a homes sold in September 2017 was just over $487,000, an increase of 2.8 per cent year-over-year. The national average price is not entirely accurate due to sales in Greater Vancouver and Greater Toronto, two of the country’s most active and expensive markets. When those two regions are excluded from calculations, the national average price of homes sold in September falls to just over $374,500.