Canadian home sales have increased for the second consecutive month, recording a 0.8 per cent increase from January to February 2016, according to statistics released by the Canadian Real Estate Association (CREA). This increase has boosted national sales activity to its highest level since June 2007.
Declines were posted in more local housing markets than increases, however the increases accounted for a larger share of national transactions. Sales increases were recorded in the Greater Toronto Area (GTA), Okanagan Region and Fraser Valley, while declines were experienced in Edmonton, Greater Moncton and Montreal.
“Two of Canada’s hottest housing markets look set to stay that way heading into the spring home buying season,” said CREA president Pauline Aunger in a press release. “Meanwhile, other major urban markets elsewhere in Canada are well balanced or have ample supply.”
Actual (not seasonally adjusted) sales activity increased 18.7 per cent year-over-year in February, which is 12.7 per cent higher than the 10-year average for the month. Activity increased year-over-year in about 75 per cent of all local markets, especially in B.C.’s Lower Mainland, the GTA and Montreal.
“The number of single family home sales above one million dollars is rising in Greater Vancouver and the GTA,” said Gregory Klump, CREA chief economist, in a press release. “Tightened mortgage regulations apply to homes selling above five hundred thousand dollars and below a million dollars. The tighter regulations combined with a short supply of single family homes will restrain transactions below one million dollars. If recent trends continue, home sales above one million dollars will account for a greater share of activity and will further fuel year-over-year average price increases in these markets. Meanwhile, price growth will remain more modest in other housing markets that don’t have an ongoing or developing supply shortage like the kind we’re seeing in the Lower mainland of British Columbia or around the GTA.”
The number of newly listed homes increased 0.5 per cent month-over-month in February, led by the rise of new listings in the Lower Mainland of B.C., York and Mississauga regions of the GTA and Hamilton-Burlington. However, those increases were offset by declines in central Toronto, Calgary and Montreal.
The Canadian housing market remains balanced overall, with a sales-to-new listings ratio at 59.5 per cent.
Meanwhile, the MLS Home Price Index increased 8.49 per cent year-over-year in February 2016, which is the largest gain it has experienced since June 2010. All property types experienced this gain, with the price of two-storey homes increasing 10.54 per cent, townhouse units up 7.41 per cent, single-storey homes up by 7.38 per cent, while apartment units saw price increases of 6.34 per cent.
The actual (not seasonally adjusted) national average price for homes in February 2016 increased 16.4 per cent year-over-year to $503,057. However, when excluding the most active provinces, British Columbia and Ontario, the average price sits at $291,510, a decline of 1.4 per cent year-over-year.