There was a split among major Canadian housing markets in December according to new data from the Canadian Real Estate Association (CREA).
The stats show that sales were down 0.9% nationwide compared to November, following a wave of gains since March while, actual (not seasonal) activity gained 22.7% year-over-year and was up 18% from the 6-year-low of February 2019.
There was increased activity in around half of Canadian markets including BC’s Lower Mainland, Calgary, and Montreal, while the rest saw declines including the GTA and Ottawa. Year-over-year though, all major urban centres gained.
Meanwhile, the Aggregate Composite MLS® Home Price Index (MLS® HPI) rose 0.8%, its seventh consecutive monthly gain taking it to 4.7% above 2019’s lowest point reached in May.
“The momentum for home price gains picked up as last year came to a close,” said Gregory Klump, CREA’s Chief Economist. “If the recent past is prelude, then price trends in British Columbia, the GTA, Ottawa and Montreal look set to lift the national result this year, despite the continuation of a weak pricing environment among housing markets across the Prairie region.”
Compared to a year earlier, price declines were focused in the Lower Mainland and major Prairie markets with gains in central and eastern Canada.
New listings are failing to keep up with sales and declined 1.8% in December and the national sales-to-new listings ratio tightened to 66.9%, the highest reading in more than 15 years.
Based on a comparison of the sales-to-new listings ratio with the long-term average, just over half of all local markets were in balanced market territory in December including Greater Vancouver (GVA) but not the GTA, where market balance favours sellers in purchase negotiations.
Inventory-challenged markets are increasing although the GTA and Ottawa accounted for the largest share of the decline in new listings in December.
There were 4.2 months of inventory on a national basis at the end of December 2019 – the lowest level recorded since the summer of 2007.