Canadian home sales continued to improve in September but there are some uncertainties that mean the rebound could stall in the months ahead.
Newly-released data from the Canadian Real Estate Association shows a 0.6% increase in home sales in September compared to the previous month.
Meanwhile, there was a 15.5% increase in actual (not seasonally adjusted) activity in the month compared to a year earlier. Sales through the MLS were 18% above the low seen in February but 8% below the highs of 2016 and 2017.
Transactions were up from year-ago levels in all of Canada’s largest urban markets, including the Lower Mainland of British Columbia, Calgary, Edmonton, Winnipeg, the Greater Toronto Area, Hamilton-Burlington, Ottawa and Montreal.
“Home sales activity and prices are improving after having weakened significantly in a number of housing markets,” said Gregory Klump, CREA’s Chief Economist. “How long the current rebound continues depends on economic growth, which is being subdued by trade and business investment uncertainties.”
Fewer new listings
September saw a reduction in new listings, down 0.6% month-over-month. There were 4.5 months of supply by the end of the month and the sales-to-new-listings ratio increased to 61.3%.
Comparing the current and long-term sales-to-new-listings ratios, three-quarters of all local markets were in balanced market territory including the GTA and Lower Mainland of British Columbia but elsewhere the ratio shows markets favouring sellers except in Saskatoon and Southeast Saskatchewan.
The Aggregate Composite MLS® Home Price Index rose 0.5% m-o-m in September 2019, its fourth consecutive monthly gain.
Meanwhile, the actual (not seasonally adjusted) national average price for homes sold in September 2019 was around $515,500, up 5.3% from the same month last year.
This average is heavily skewed by sales in the GVA and GTA and without these markets the average was less than $397,000, reducing the year-over-year gain to 3.3%.