Recent News

Canadian home sales rise in October

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Canadian home sales rise in October

Ottawa, ON, November 15, 2016 – According to statistics released today by The Canadian Real Estate Association (CREA), national home sales were up on a month-over-month basis in October 2016.

Highlights:

  • National home sales rose 2.4% from September to October.
  • Actual (not seasonally adjusted) activity was up 2.0% year-over-year (y-o-y) in October 2016.
  • The number of newly listed homes edged up 1.7% from September to October.
  • The MLS® Home Price Index (HPI) in October was up 14.6% y-o-y.
  • The national average sale price climbed 5.9% y-o-y.

The number of homes trading hands via Canadian MLS® Systems rose 2.4 percent month-over-month in October 2016.

Activity was up on a month-over-month basis about 60 percent of all local markets, led by the Fraser Valley, Calgary, Edmonton, Hamilton-Burlington and Montreal.

“The expanded stress-test for home buyers who need mortgage default insurance took effect in the middle of October,” said CREA President Cliff Iverson. “More time will need to pass before its effect on housing markets can be gauged. The extent to which they will push first-time home buyers to the sidelines may vary among housing markets. All real estate is local, and REALTORS® remain your best source for information about sales and listings where you live or might like to in the future.”

“First-time home buyers looking to get into the market before having to face tougher mortgage eligibility criteria had only two weeks to do so following the Finance Minister’s announcement of tighter mortgage regulations in early October,” said Gregory Klump, CREA’s Chief Economist. “Early evidence suggests that the influence of tighter mortgage regulations on sales activity has been mixed. The federal government will no doubt want to monitor the effect of new mortgage regulations on the many varied housing markets across Canada and on the economy, particularly given the recent rise in uncertainty about economic growth prospects following the U.S. presidential election.”

Actual (not seasonally adjusted) sales activity rose 2 percent y-o-y in October 2016 to set a record for the month, edging out the previous record set back in October 2009 by just 0.8 percent.

Transactions were up from year-ago levels in about 60 percent of all Canadian markets, with activity gains in the Greater Toronto Area (GTA) and environs offset by y-o-y declines in B.C.’s Lower Mainland.

The number of newly listed homes climbed 1.7 percent in October 2016 compared to September. Led by a marked increase in the GTA, new listings were up from the previous month in about 60 percent of all local markets.

With sales having risen by slightly more than new listings in October, the national sales-to-new listings ratio edged higher to 62.9 percent compared to 62.4 percent in September.

A sales-to-new listings ratio between 40 and 60 percent is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.

The ratio was above 60 percent in half of all local housing markets in October, the vast majority of which continue to be located in British Columbia, in and around the Greater Toronto Area and across Southwestern Ontario. The ratio has moved out of sellers’ market territory and into the mid-50 percent range in Greater Vancouver.

The number of months of inventory is another important measure of the balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 4.5 months of inventory on a national basis at the end of October 2016 – the lowest level in almost 7 years.

The tight balance between housing supply and demand in Ontario’s Greater Golden Horseshoe region is without precedent (including the GTA, Hamilton-Burlington, Oakville-Milton, Guelph, Kitchener-Waterloo, Cambridge, Brantford, the Niagara Region, Barrie and nearby cottage country). In October, the number of months of inventory ranged between one and two months in many of these housing markets, and has slipped to below one month in Mississauga, the Durham Region, Orangeville, Cambridge and Guelph.

The Aggregate Composite MLS® HPI rose by 14.6 percent y-o-y in October 2016, up from 14.4 percent in September.

On a y-o-y basis, price growth accelerated for two-storey single family homes and apartment units while slowing for townhouse/row units.

Benchmark prices for two-storey single family homes and townhouse/row units posted the biggest y-o-y gains in October 2016 (16.7 percent and 16.0 percent respectively). Price increases were not far behind for one-storey single family homes (14.0 percent) and apartment units (11.4 percent).

While prices in 9 of the 11 markets tracked by the MLS® HPI posted y-o-y gains in October, increases continue to vary widely among housing markets.

Greater Vancouver (+24. 8 percent) and the Fraser Valley (+32.5 percent) posted the largest y-o-y gains, although single family home prices in both of these markets are now off peak.

Double-digit y-o-y percentage price gains were also registered in Greater Toronto (+19.7 percent), Victoria (+20.1 percent) and Vancouver Island (+15.8 percent).

By contrast, prices were down 4.1 percent y-o-y in Calgary. Although home prices there have held mostly steady since May, they have been below year-ago levels since August 2015 and are down 5.1 percent from the peak reached in January 2015.

Home prices also edged lower by 1.3 percent y-o-y in Saskatoon. Home prices in Saskatoon have also held below year-ago levels since August 2015.

Meanwhile, home prices posted y-o-y gains in Regina (+4.5 percent), Ottawa (+3.0 percent), Greater Moncton (+2.8 percent) and Greater Montreal (+2.6 percent).

The MLS® Home Price Index (MLS® HPI) provides the best way of gauging price trends because average price trends are prone to being strongly distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average price for homes sold in October 2016 was up 5.9 percent y-o-y to $481,994.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets.

That said, Greater Vancouver’s share of national sales activity has diminished considerably of late, resulting in it having less upward influence on the national average price. Even so, the average price is reduced by more than $120,000 to $361,012 if Greater Vancouver and Greater Toronto sales are excluded from calculations.

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PLEASE NOTE: The information contained in this news release combines both major market and national sales information from MLS® Systems from the previous month. 

CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types. 

MLS® Systems are co-operative marketing systems used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale. 

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

Further information can be found at http://crea.ca/statistics.

For more information, please contact:

Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

The Canadian Real Estate Association Achieves Excellence Canada Gold Level Certification

Posted by on 1:28 pm in CREA News | 0 comments

The Canadian Real Estate Association Achieves Excellence Canada Gold Level Certification

Ottawa, ON, October 27, 2016 — The Canadian Real Estate Association (CREA) is pleased to announce that it has achieved Gold Level certification in the Excellence, Innovation and Wellness (EIW) Standard of Excellence Canada.

Key attributes of a Gold level certification include an organization-wide focus on excellence, innovation and wellness issues; meeting and exceeding strategic goals; positive results achieved across all areas/departments of the organization; and widespread quantifiable improvement as a result of moving from reactive to proactive approaches and practices.

“REALTORS® across the country can be proud of their national association,” said Cliff Iverson, president of CREA. “The Gold Level certification is a tangible sign that CREA is committed to achieving excellence through continuous improvement.”

CREA’s Chief Executive Officer, Gary Simonsen, added “This award is a clear testament to CREA’s achievements and our continued commitment to being among the best Canadian organizations to work for.”

Founded by Industry Canada, Excellence Canada is a not-for-profit corporation dedicated to advancing organizational performance across Canada. Since its inception, Excellence Canada has helped thousands of organizations in Canada implement continual quality improvement systems and employee wellness strategies. As Canada’s national authority on Quality and Healthy Workplace® practices, Excellence Canada provides measurable standards and objective validation through its certification programs.

According to Excellence Canada, excellent organizations continually improve performance; they are innovative, competitive, and customer focused; they are healthy, inclusive, and sustainable; and they are economically, socially, and environmentally responsible.

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

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For more information, please contact:

Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

 

Bank of Canada keeps rates on hold, lowers growth outlook

Posted by on 3:09 pm in CREA News | 0 comments

Bank of Canada keeps rates on hold, lowers growth outlook

The Bank of Canada announced on October 19th, 2016 that it was keeping its trend-setting target overnight lending rate at 0.5 per cent.

The announcement and accompanying Monetary Policy Report (MPR) indicated that:

  • Canadian economic growth will be lower than previously expected, “due in large part to slower near-term housing resale activity and a lower [growth] trajectory for exports.”
  • The economy is now on track to “[return] to full capacity around mid-2018,” which is “materially later than Bank had anticipated in July.”
  • Recently tightened mortgage regulations will “likely restrain residential investment while dampening household vulnerabilities,” and “should mitigate risks to the financial system over time.”
  • Inflation remains well contained within the Bank’s target range.

As such, the Bank will keep interest rates on hold for at least another year and perhaps maybe even into 2018.

As of October 19th, 2016, the advertised five-year lending rate stood at 4.64 per cent, up 0.1 per cent from the previous Bank rate announcement on September 7th but unchanged from one year ago.

The next interest rate announcement will be on December 7th, 2016. The next release of the Monetary Policy Report, which will update the Bank economic forecast, will be on January 18th, 2017.

(CREA 18/10/2016)

Canadian home sales edge up in September

Posted by on 1:00 pm in CREA News | 0 comments

Canadian home sales edge up in September

Ottawa, ON, October 14, 2016 According to statistics released today by The Canadian Real Estate Association (CREA), national home sales edged slightly higher in September 2016 compared to August.

Highlights:

  • National home sales edged up 0.8% from August to September.
  • Actual (not seasonally adjusted) activity in September rose 4.2% year-over-year (y-o-y).
  • The number of newly listed homes ticked up 0.5% from August to September.
  • The MLS® Home Price Index (HPI) in September was up 14.4% y-o-y.
  • The national average sale price climbed 9.5% y-o-y.

The number of homes trading hands natl_chart_of_interest01_lo-res_envia Canadian MLS® Systems rose 0.8 percent month-over-month in September 2016. Having eased in each of the previous four months, national home sales are 5.6 percent below the record set in April 2016.

The number of markets was evenly split between those where activity rose on a month-over-month basis and those where it declined. Continuing recent trends, sales climbed further in and around the Greater Toronto Area (GTA) and fell further in and around the Lower Mainland of British Columbia.

As previously reported, Greater Vancouver and Fraser Valley home sales had retreated sharply for five months straight before the new foreign buyers’ tax in Metro Vancouver was announced in August. Activity has returned to more normal levels after having peaked at the start of this year. Indeed, most of the decline since the April peak in national sales reflects the rapid drop in activity in and around B.C.’s Lower Mainland.

“The Finance Minister’s recent changes to regulations affecting mortgage lending has added to housing market uncertainty among buyers and sellers,” said CREA President Cliff Iverson. “For first-time home buyers, the stress test for those who need mortgage default insurance will cause them to rethink how much home they can afford to buy.”

“First-time home buyers, particularly in housing markets with a lack of affordable inventory of single family homes, may be priced out of the market by the new regulations that take effect on October 17th,” said Gregory Klump, CREA’s Chief Economist. “First-time home buyers support a cascade of other homes changing hands, making them the linchpin of the housing market. The federal government will no doubt want to monitor the effect of new regulations on the many varied housing markets across Canada and on the economy, particularly given the uncertain outlook for other private sector engines of economic growth.”

Actual (not seasonally adjusted) sales activity was up 4.2 percent y-o-y in September 2016. Transactions were up from year-ago levels in almost two-thirds of all Canadian markets. Led by the GTA and environs, the increase was held in check by the drop in activity in B.C.’s Lower Mainland.

The number of newly listed homes inched up by 0.5 percent in September 2016 compared to August. As with sales activity, the number of markets where new listings were up on a month-over-month basis and those where they fell was evenly split. With inventory in acutely short supply, the rise in new listings supported higher sales activity in the GTA and the national total.

With sales and new listings having risen by similar magnitudes, the national sales-to-new listings ratio (62.1 percent) was little changed from August (61.9 percent) and remains well off the peak reached in May (65.3 percent).

A sales-to-new listings ratio between 40 and 60 percent is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.

The ratio was above 60 percent in almost half of all local housing markets in September, virtually all of which continue to be located in British Columbia, in and around the Greater Toronto Area and across Southwestern Ontario. However, the ratio has moved out of sellers’ market territory and into the mid-50 percent range in Greater Vancouver and the Fraser Valley.

The number of months of inventory is another important measure of the balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 4.7 months of inventory on a national basis at the end of September 2016. The measure has remained virtually unchanged since April, with fewer sales in the Lower Mainland counterbalanced by a shrinking supply of listings in and around the GTA.

The tight balance between housing supply and demand in Ontario’s Greater Golden Horseshoe region is without precedent (including the GTA, Hamilton-Burlington, Oakville-Milton, Guelph, Kitchener-Waterloo, Cambridge, Brantford, the Niagara Region, Barrie and nearby cottage country). The number of months of inventory ranges between one and two months in Greater Golden Horseshoe housing markets and is less than one month inside the GTA.

natl_chart_of_interest03_lo-res_enThe Aggregate Composite MLS® HPI rose by 14.4 percent y-o-y in September 2016. Down from 14.7 percent in August this was the first deceleration since March 2015.

On a y-o-y basis, price growth throttled back for one-storey single family homes and apartment units and held steady for two-storey single family homes and townhouse/row units.

Townhouse/row unit and two-storey single family home posted the biggest y-o-y increases in September 2016 (16.4 percent and 16.3 percent respectively). Price increases were close behind for one-storey single family homes (14.0 percent) and apartment units (11.1 percent).

While prices in 9 of the 11 markets tracked by the MLS® HPI posted y-o-y gains in September, increases continue to vary widely among housing markets.

Greater Vancouver (+28. 2 percent) and the Fraser Valley (+35.0 percent) posted the largest y-o-y gains by a wide margin. However, single family home prices in both of these markets dropped from the month before, marking the first significant decline since late 2012.

Double-digit y-o-y percentage price gains were also registered in Greater Toronto (+18.0 percent), Victoria (+19.4 percent) and Vancouver Island (+13.9 percent).

By contrast, prices were down -4.1 percent y-o-y in Calgary. Although home prices there have held steady since May, they have remained below year-ago levels since August 2015 and are down 4.6 percent from the peak reached in January 2015.

Home prices also edged lower by 1.2 percent y-o-y in Saskatoon. Home prices in Saskatoon have also held below year-ago levels since August 2015.

Meanwhile, home prices posted additional y-o-y gains in Regina (+4.9 percent), Greater Moncton (+4.2 percent), Ottawa (+2.7 percent) and Greater Montreal (+2.7 percent).

The MLS® Home Price Index (MLS® HPI) provides the best way of gauging price trends because average price trends are prone to being strongly distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average price for homes sold in September 2016 was up 9.5 percent y-o-y to $474,590.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets.

That said, Greater Vancouver’s share of national sales activity has diminished considerably of late, resulting in it having less upward influence on the national average price. Even so, the average price is reduced by more than $100,000 to $358,884 if Greater Vancouver and Greater Toronto sales are excluded from calculations.

– 30 –

PLEASE NOTE: The information contained in this news release combines both major market and national sales information from MLS® Systems from the previous month.

CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.

MLS® Systems are co-operative marketing systems used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale.

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

Further information can be found at http://www.crea.ca/statistics.

For more information, please contact:
Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

Canadian home sales decline further in August

Posted by on 1:00 pm in CREA News | 0 comments

Canadian home sales decline further in August

Ottawa, ON, September 15, 2016 According to statistics released today by The Canadian Real Estate Association (CREA), national home sales declined for a fourth consecutive month in August 2016.

Highlights:

  • National home sales fell 3.1% from July to August.
  • Actual (not seasonally adjusted) activity came in 10.2% above August 2015.
  • The number of newly listed homes declined 2.7% from July to August.
  • The MLS® Home Price Index (HPI) rose 14.7% year-over-year in August.
  • The national average sale price climbed 5.4% in August from one year ago.

The number of homes trading hands via Canadian MLS® Systems fell by 3.1 percent month-over-month in August 2016 – the largest monthly decline since December 2014. Together with declines in each of the three previous months, the slowdown in August places national home sales activity 6.9 percent below the record set in April 2016.

Sales activity was down from levels in the previous month in close to 60 per cent of all markets in August, led by a steep decline in Greater Vancouver following the introduction of a new property transfer tax on homes purchased by foreign buyers.

natl_chart_of_interest01_lo-res_enActivity also dropped significantly in the Fraser Valley. August marked the sixth consecutive monthly decline for home sales in the Lower Mainland, as transactions in Greater Vancouver and the Fraser Valley had already been retreating sharply from their peak reached in February. Much of the monthly declines in national sales in recent months reflect slowing activity in the Lower Mainland.

“The sudden introduction of the new property transfer tax on homes purchased by foreign buyers in Metro Vancouver has created a cloud of uncertainty among home buyers and sellers,” said CREA President Cliff Iverson. “That the tax applies to sales that had not yet closed shows how the details for a new tax policy can unnecessarily destabilize housing markets. More broadly, it speaks to the importance of evidence-based decision making to ensure that unintended consequences and collateral damage are minimized when new policies or tighter regulations affecting housing markets are being actively considered.”

“Single family homes sales were already cooling before the new land transfer tax on foreign home buyers in Metro Vancouver came into effect,” said Gregory Klump, CREA’s Chief Economist. “The surprise announcement of the new tax caused sales to brake hard.”

Actual (not seasonally adjusted) sales activity was up 10.2 percent year-over-year (y-o-y) in August 2016. Sales were up from year-ago levels in about three-quarters of all Canadian markets, led by Greater Toronto. By contrast, Greater Vancouver posted the largest year-over-year sales decline.

The number of newly listed homes fell by 2.7 percent in August 2016 compared to July. While new supply was down in just over half of all local markets, declines in the Lower Mainland, Greater Toronto and Montreal far outweighed the monthly rise in new listings in less active markets.

With sales and new listings both down by similar magnitudes in August, the national sales-to-new listings ratio was 61.6 percent, which was little changed from 61.8 percent in July. The ratio had previously been as high as 65.3 percent in May.

A sales-to-new listings ratio between 40 and 60 percent is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.

The ratio was above 60 percent in almost half of all local housing markets in August, virtually all of which continue to be located in British Columbia, in and around the Greater Toronto Area and across Southwestern Ontario. Notably, the ratio moved into the mid-50 percent range in Greater Vancouver in August after having begun the year at 90 percent.

The number of months of inventory is another important measure of the balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 4.8 months of inventory on a national basis at the end of August 2016. This was up from 4.6 months in the previous three months and marked the first increase in almost a year.

The number of months of inventory had been trending lower since early 2015, reflecting increasingly tighter housing markets in Ontario – and, until recently, in B.C. It nonetheless remains below two months in Victoria and virtually everywhere within the Greater Golden Horseshoe region, including Greater Toronto, Hamilton-Burlington, Oakville-Milton, Guelph,

Kitchener-Waterloo, Cambridge, Brantford, the Niagara Region, Barrie and Woodstock-

Ingersoll. Indeed, major areas within the GTA have less than one month of inventory.

natl_chart_of_interest03_lo-res_enThe Aggregate Composite MLS® HPI rose by 14.7 percent y-o-y in August 2016, the biggest gain since October 2006.

For the seventh consecutive month, y-o-y price growth accelerated for all Benchmark property types tracked by the index.

Two-storey single family home prices posted a 16.3 percent year-over-year increase in August 2016, as did townhouse/row units. One-storey single family homes followed close behind with a y-o-y increase of 14.4 percent, while apartment unit prices rose 11.7 percent y-o-y.

While prices in 9 of the 11 markets tracked by the MLS® HPI posted y-o-y gains in August, increases continue to vary widely among housing markets.

Greater Vancouver (+31.4 percent) and the Fraser Valley (+38.3 percent) posted the largest y-o-y gains by a wide margin. Smaller double-digit y-o-y percentage price gains were also recorded by Greater Toronto (+17.2 percent), Victoria (+18.9 percent) and Vancouver Island (+13.1 percent).

By contrast, prices were down -4.1 percent y-o-y in Calgary in August. Although prices there have held steady since May 2016, they have remained down from year-ago levels since September 2015 and are 4.7 percent below the peak reached in January 2015.

Additionally, prices were down by -0.9 percent y-o-y in Saskatoon in August. While prices have remained below year-ago levels since August 2015, they are on track to begin rebounding before year-end should current trends persist.

Meanwhile, home prices posted additional y-o-y gains in Greater Moncton (+6.6 percent), Regina (+3.7 percent), Greater Montreal (+2.5 percent) and Ottawa (+1.7 percent).

The MLS® Home Price Index (MLS® HPI) provides the best way of gauging price trends because average price trends are prone to being distorted by changes in the mix of sales activity from one month to the next.

The actual (not seasonally adjusted) national average price for homes sold in August 2016 was $456,722, up 5.4 percent y-o-y, making it the smallest increase since January 2015.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets.

Greater Vancouver’s share of national sales activity has diminished, causing it to have less upward influence on the national average price. Nonetheless, if Greater Vancouver and Greater Toronto are excluded from calculations, the average price is reduced by about $100,000 to $357,033.

– 30 –

PLEASE NOTE: The information contained in this news release combines both major market and national sales information from MLS® Systems from the previous month.

CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.

MLS® Systems are co-operative marketing systems used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale.

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

Further information can be found at http://www.crea.ca/statistics.

For more information, please contact:
Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

CREA Updates Resale Housing Forecast

Posted by on 12:59 pm in CREA News | 0 comments

Ottawa, ON, September 15, 2016 – The Canadian Real Estate Association (CREA) has updated its forecast for home sales activity via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards and Associations in 2016 and 2017.

Canadian housing market trends have largely evolved in line with previous expectations over the second quarter of 2016, with the exception of sales activity in British Columbia and Ontario.

Sales in the Lower Mainland of British Columbia have braked more abruptly than anticipated, reflecting buyer uncertainty following the introduction of the new property transfer tax on Metro Vancouver home purchases by foreign buyers. By comparison, transactions in Ontario have held steady in recent months near record levels and have yet to show signs of cooling.

Taking these factors into consideration, sales forecasts have been revised upward for Ontario and downward for British Columbia. These revisions largely offset each other at the national level.

In addition, Alberta’s sales forecast has been revised upward, reflecting better than expected activity during the second quarter and decent sales momentum entering the third quarter. Even so, the current economic climate suggests Alberta sales may struggle to maintain traction over the remainder of 2016 and into 2017.

Nationally, sales activity is forecast to rise by 6.0 per cent to 535,900 units in 2016, which is little changed from CREA’s previously predicted sales increase of 6.1 per cent to 536,400 units this year. This represents a new record for annual sales. However, after adjusting for population growth, sales are still expected to remain below the peak reached in 2007. (Figure A)

Among the most populous provinces, British Columbia is still forecast to post the largest annual increase in activity this year (+14.6 percent) notwithstanding that much of its strength is in the rear-view mirror at this point.

Prince Edward Island is forecast to post the largest annual percentage increase in sales this year (+20.1 percent). This would make it one of only four provinces to set a new annual sales record in 2016, along with British Columbia, Manitoba and Ontario.

Among provinces where housing market prospects are closely tied to the outlook for natural resource prices, Alberta is still expected to record the largest annual decline in activity in 2016 (-8.8 per cent), followed by Saskatchewan (6.1 per cent). Meanwhile, Newfoundland and Labrador is now forecast to register a small increase of 1.2 percent due to stronger than expected sales in the second quarter.

Although housing demand remains strong among many housing markets in Ontario, a lack of supply is projected to restrain the increase in sales activity (+7.1 percent) this year.

Elsewhere, sales are forecast to rise in Manitoba (+5.3 per cent), Quebec (+5.2 per cent), New Brunswick (+2.8 per cent) and Nova Scotia (+3.1 per cent), reflecting recent sales momentum and anticipated improvements in economic prospects in these provinces.

Year-over-year average price gains have continued to mount in Ontario and British Columbia. While having accelerated in the former, price growth showed tentative signs of moderating in the latter. As a result, the average home price forecast for Ontario has been raised further but revised lower for B.C., reflecting a bigger than anticipated decline in higher-priced single detached home sales in the Lower Mainland region.

In provinces where economic and housing market prospects are closely tied to the outlook for the oil patch and other natural resource industries, average prices appear to be stabilizing in Alberta and Saskatchewan while softening further in Newfoundland and Labrador. Average prices in other provinces are either rising modestly or remain stable, reflecting well balanced supply and demand.

The national average price is now forecast to rise by 10.1 per cent to $487,800 in 2016, with a slightly smaller gain in British Columbia ($695,000; +9.2 per cent) and a slightly larger gain in Ontario ($524,600; +12.7 per cent). Elsewhere, average prices are forecast to rise by 1.6 percent in Manitoba, and by 2.1 percent in both Quebec and New Brunswick. Annual average prices in Alberta, Saskatchewan and Nova Scotia are projected to remain largely stable.

By comparison, the average price forecast for Prince Edward Island (+9.3 percent) has been raised to reflect exceptionally strong price gains in the second quarter. Newfoundland and Labrador’s average price is now forecast to ease by 6.4 percent.

In 2017, national sales are forecast to number 532,900 units, representing a decline of -0.6 per cent from projected activity this year. Transactions in B.C. and Ontario are anticipated to remain strong but fall short of this year’s record levels due to deteriorating affordability and a lack of supply for single family homes. British Columbia home sales are forecast to decline by 4.0 percent, while annual sales in Ontario are forecast to retreat by 1.0 percent.

Sales are also forecast to ease slightly in 2017 in New Brunswick (-0.6 percent), Nova Scotia (-2.2 per cent) and Prince Edward Island. In the case of New Brunswick and Prince Edward Island, those declines are more a story about unexpected strength in 2016. The sales forecast for Prince Edward Island in 2017 is still historically very strong, as the province’s economy is expected to continue to benefit from a lower Canadian dollar.

Meanwhile, consumer confidence should start to strengthen and slowly draw homebuyers off the sidelines in Alberta, Saskatchewan and Newfoundland and Labrador as oil prices and economic prospects gradually improve. The forecast rise in Alberta’s sales in 2017 also reflects slow sales activity in the first quarter of 2016, a repeat of which is not expected.

Sales activity is forecast to continue rising in Manitoba (+2.8 percent) and Quebec (+1.8 percent), reflecting further anticipated improvements for these provinces economic prospects.

The national average price is forecast to ease by 0.2 per cent to $486,600 next year, with modest price gains near or below inflation in most provinces save for British Columbia, which is forecast to see a small decline of about two percent.

That flat profile for the national average price in 2017 along with a decline in British Columbia is reminiscent of 2012, when a more normal year for activity in Greater Vancouver followed record level sales activity at the highest end of its housing market the year before. As such, the forecast decline reflects the influence of sales activity on average price, as it did in 2012 versus 2011.

Meanwhile, an ample supply of listings relative to demand will continue to keep price gains in check in other provinces, although inventories have begun to shrink in provinces where supply had been elevated in recent years.

– 30 –

About The Canadian Real Estate Association
The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 111,000 real estate Brokers/agents and salespeople working through more than 100 real estate Boards and Associations.

For more information, please contact:

Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

Bank of Canada keeps interest rates on hold

Posted by on 9:10 pm in CREA News | 0 comments

The Bank of Canada announced on September 7th, 2016 that it was keeping its trend-setting target overnight lending rate at 0.5 per cent.

The Bank acknowledged that inflation risks were “tilted more to the downside since July” when it published its most recent economic forecast. Normally, this would signal that it may lower interest rates in the near future.

However, the Bank also said it remains concerned about rising mortgage debt, throwing cold water on the idea that it might lower rates for fear of fueling further household debt.

The big picture for the Bank’s key policy interest rate remains unchanged: it will stay low for longer – likely remaining where it is when the first day of school rolls around next year and maybe beyond.

As of September 7th, 2016, the advertised five-year lending rate stood at 4.74 per cent, unchanged from the previous Bank rate announcement on July 13th and up 0.1 per cent from one year ago.

The next interest rate announcement will be on October 19th, 2016 and will be accompanied by its Monetary Policy Report which will update the Bank economic forecast.

(CREA 07/09/2016)

Canadian home sales post third consecutive decline in July

Posted by on 1:00 pm in CREA News | 0 comments

Ottawa, ON, August 15, 2016 – According to statistics released today by The Canadian Real Estate Association (CREA), national home sales declined for a third consecutive month in July 2016.

Highlights:

  • National home sales fell 1.3% from June to July.
  • Actual (not seasonally adjusted) activity came in 2.9% below July 2015.
  • The number of newly listed homes rose 1.2% from June to July.
  • The MLS® Home Price Index (HPI) rose 14.3% year-over-year in July.
  • The national average sale price climbed 9.9% in July from one year ago; net of the Greater Toronto Area (GTA) and Greater Vancouver, it advanced 7% year-over-year.

natl_chart_of_interest01_lo-res_enThe number of homes trading hands via Canadian MLS® Systems fell by 1.3 percent month-over-month in July 2016. With similar monthly declines having been posted in May and June, national sales activity in July came in 3.9 percent below the record set in April 2016.

Sales activity was down from the previous month in slightly more than half of all markets in July, led by Greater Vancouver and the Fraser Valley. Transactions in these two markets peaked in February of this year, and have since then dropped by 21.5 and 28.8 percent respectively. Accordingly, much of the national sales decline in recent months reflects slowing activity in B.C.’s Lower Mainland.

“National sales and price trends continue to be heavily influenced by a handful of places in Ontario and British Columbia and mask significant variations in local housing market trends and conditions across Canada,” said CREA President Cliff Iverson. “All real estate is local, and REALTORS® remain your best source for information about sales, listing and price trends where you live or might like to in the future.”

“Home sales continued to trend lower while price gains further accelerated in the Lower Mainland of British Columbia,” said Gregory Klump, CREA’s Chief Economist. “This suggests that sales are being reined in by a lack of inventory and a further deterioration in affordability. The new 15 per cent property transfer tax on Metro Vancouver home purchases by foreign buyers took effect on August 2nd, so it will take some time before the effect of the new tax on sales and prices can be observed. That said, the new tax will do little in the short term to increase the supply of homes.”

Actual (not seasonally adjusted) sales activity was down 2.9 percent year-over-year (y-o-y) in July 2016, marking the first y-o-y decline since January 2015 and the largest since April 2013. In line with softening activity in the Lower Mainland, y-o-y increases have been losing momentum since February 2016. Sales were down from levels one year earlier in about 60 percent of all Canadian markets, led by Greater Vancouver, the Fraser Valley, Calgary and Edmonton.

The number of newly listed homes rose by 1.2 percent in July 2016 compared to June. While new supply climbed in fewer than half of all local markets, increases in Greater Vancouver and the Fraser Valley, Greater Toronto, Calgary and Edmonton outweighed declines in smaller markets.

With sales down and new listings up, the national sales-to-new listings ratio eased to 61.6 percent in July 2016 – its second monthly decline following its peak of 65.3 percent in May. A sales-to-new listings ratio between 40 and 60 percent is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.

The ratio was above 60 percent in about half of all local housing markets in July, virtually all of which continue to be located in British Columbia, in and around the Greater Toronto Area and across Southwestern Ontario.

The number of months of inventory is another important measure of the balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 4.6 months of inventory on a national basis at the end of July 2016. This is unchanged from readings in each of the previous two months and continues to indicate a tight balance between supply and demand for homes.

The number of months of inventory has trended lower since early 2015, reflecting increasingly tighter housing markets in B.C. and Ontario. It currently sits near or below two months in a number of local markets in British Columbia and in and around the GTA. Indeed, some regions in the GTA are down to just a couple of weeks of inventory.

natl_chart_of_interest03_lo-res_enThe Aggregate Composite MLS® HPI rose by 14.3 percent y-o-y in July 2016, the biggest gain since November 2006.

For the sixth consecutive month, y-o-y price growth accelerated for all Benchmark property types tracked by the index.

Two-storey single family home prices continued to post the biggest y-o-y gain (+15.9 percent), followed by townhouse/row units (+15.3 percent), one-storey single family homes (+14.3 percent), and apartment units (+11.1 percent).

While prices in 9 of the 11 markets tracked by the MLS® HPI posted y-o-y gains in July, increases continue to vary widely among housing markets.

Greater Vancouver (+32.6 percent) and the Fraser Valley (+37.6 percent) posted the largest y-o-y gains by a wide margin, followed by Greater Toronto (+16.7 percent), Victoria (+17.5 percent) and Vancouver Island (+11.6 percent). By contrast, prices were down -4.2 percent and -1.5 percent y-o-y in Calgary and Saskatoon respectively.

Home prices rose modestly in Regina (+2.7 percent y-o-y), Greater Montreal (+1.8 percent y-o-y) and Ottawa (+1.1 percent y-o-y). Greater Moncton recorded its largest y-o-y home price increase (+8.4 percent) among an unbroken string of gains posted every month over the past year.

The MLS® Home Price Index (MLS® HPI) provides a the best way of gauging price trends because average price trends are prone to being distorted by changes in the mix of sales activity from one month to the next.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets. The actual (not seasonally adjusted) national average price for homes sold in July 2016 was $480,743, up 9.9 percent y-o-y.

If these two housing markets are excluded from calculations, the average price is a more modest $365,033 and the gain is trimmed to 7.0 percent y-o-y.

Even then, this reflects a tug of war between strong average price gains in housing markets around the GTA and in British Columbia versus flat or declining average prices elsewhere in Canada. The average price for Canada net of sales in British Columbia and Ontario in July 2016 edged down 0.2 percent y-o-y to $310,905. The year-over-year percentage change in the national average price excluding B.C. and Ontario sales has now been in negative territory for 20 consecutive months.

– 30 –

PLEASE NOTE: The information contained in this news release combines both major market and national sales information from MLS® Systems from the previous month.

CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.

MLS® Systems are co-operative marketing systems used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale.

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

Further information can be found at http://www.crea.ca/statistics.

For more information, please contact:
Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

Canadian home sales decline further in June

Posted by on 1:00 pm in CREA News | 0 comments

Ottawa, ON, July 15, 2016 – According to statistics released today by The Canadian Real Estate Association (CREA), national home sales declined further in June 2016.

Highlights:

  • National home sales fell 0.9% from May to June.
  • Actual (not seasonally adjusted) activity came in 5.2% above June 2015.
  • The number of newly listed homes rose 2.2% from May to June.
  • The MLS® Home Price Index (HPI) rose 13.6% year-over-year in June.
  • The national average sale price climbed 11.2% in June from one year ago; net of Greater Toronto and Greater Vancouver, it advanced 8.4% year-over-year.

natl_chart_of_interest01_lo-res_enThe number of homes trading hands via Canadian MLS® Systems fell by 0.9 percent month-over-month in June 2016. Monthly declines in each of the past two months have left sales activity 2.6 percent below the record set in April 2016.

Sales activity was down from the previous month in about half of all markets in June, with declines in Greater Vancouver, the Fraser Valley and Greater Toronto having eclipsed gains in comparatively less active housing markets.

“While national sales activity remains strong, there are still significant differences in housing market trends across Canada,” said CREA President Cliff Iverson. “While home sales activity and price growth are running strong in B.C. and Ontario, they remain subdued in other markets where homebuyers are cautious and uncertain about the outlook for their local economy,” he added. “All real estate is local, and REALTORS® remain your best source for information about sales and listings where you live or might like to in the future.”

“June sales extended trends observed the previous month,” said Gregory Klump, CREA’s Chief Economist. “As was the case in May, the monthly decline in national sales activity was led by the Lower Mainland of British Columbia and markets in or around the GTA. In keeping with the law of supply and demand, exceptionally low inventory combined with high demand continues to translate into strong price growth in these housing markets, where year-over-year price gains have been running in double-digit territory since late last year.”

Actual (not seasonally adjusted) sales activity was up 5.2 percent year-over-year (y-o-y) in June 2016. Year-over-year increases have been steadily losing momentum since February 2016.

The number of newly listed homes rose by 2.2 percent in June 2016 compared to May. New supply climbed among a broad majority of all local markets, led by Greater Toronto, Oakville-Milton, Montreal, Quebec City, and B.C.’s Fraser Valley. The return of activity in Fort McMurray following its evacuation in May also contributed to the national increase in new listings.

With sales down and new listings up, the national sales-to-new listings ratio eased to 63.3 percent in June 2016, compared to 65.3 percent in May. A sales-to-new listings ratio between 40 and 60 percent is generally consistent with balanced housing market conditions, with readings below and above this range indicating buyers’ and sellers’ markets respectively.

The ratio was above 60 percent in about half of all local housing markets in June, virtually all of which are located in British Columbia, in and around Toronto and across Southwestern Ontario.

The number of months of inventory is another important measure of the balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 4.6 months of inventory on a national basis at the end of June 2016, which is unchanged from May’s reading and the lowest level in more than six years. The number of months of inventory has been trending lower since early 2015, reflecting increasingly tighter housing markets in B.C. and Ontario. It currently sits near or below two months in a number of local markets in British Columbia, the GTA and environs and Southwestern Ontario.

natl_chart_of_interest03_lo-res_enThe Aggregate Composite MLS® Benchmark price rose by 13.6 percent y-o-y to $564,700 in June 2016, the biggest gain since December 2006.

For the fifth consecutive month, y-o-y price growth accelerated for all Benchmark property types tracked by the index.

Two-storey single family home prices continued to post the biggest y-o-y gain (+15.5 percent), followed by one-storey single family homes (+14.0 percent), townhouse/row units (+13.6 percent), and apartment units (+9.8 percent).

While prices in 9 of the 11 markets tracked by the MLS® HPI posted y-o-y gains in June, price growth continues to vary widely among housing markets.

Greater Vancouver (+32.1 percent) and the Fraser Valley (+35.5 percent) posted the largest y-o-y gains, followed by Greater Toronto (+16.0 percent), Victoria (+15.7 percent), and Vancouver Island (+10.6 percent). By contrast, prices were down -4.1 percent and -1.4 percent y-o-y in Calgary and Saskatoon, respectively.

Home prices gained further traction in Regina (+3.6 percent y-o-y), Greater Montreal (+1.9 percent y-o-y), and Ottawa (+1.0 percent y-o-y). Home prices in Greater Moncton recorded their eleventh consecutive year-over-year gain, rising 7.9 percent.

The MLS® Home Price Index (MLS® HPI) provides the best way of gauging price trends because average price trends are prone to being distorted by changes in the mix of sales activity from one month to the next.

The national average price continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which remain two of Canada’s tightest, most active and expensive housing markets. The actual (not seasonally adjusted) national average price for homes sold in June 2016 was $503,301, up 11.2 percent y-o-y.

If these two housing markets are excluded from calculations, the average price is a more modest $374,760 and the gain is trimmed to 8.4 percent y-o-y.

– 30 –

PLEASE NOTE: The information contained in this news release combines both major market and national sales information from MLS® Systems from the previous month.

CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.

MLS® Systems are co-operative marketing systems used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale.

The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 115,000 REALTORS® working through some 90 real estate Boards and Associations.

Further information can be found at http://www.crea.ca/statistics.

For more information, please contact:

Pierre Leduc, Media Relations
The Canadian Real Estate Association
Tel.: 613-237-7111 or 613-884-1460
E-mail: pleduc@crea.ca

Bank of Canada again keeps interest rates on hold

Posted by on 5:33 pm in CREA News | 0 comments

The Bank of Canada announced on July 13th, 2016 that it was keeping its trend-setting target overnight lending rate at 0.5 per cent.

The announcement repeated many of the themes from its announcements and Monetary Policy Reports (MPRs) published in late 2015 and early 2016. Chief among these themes is how the Bank is still counting on the continuation of low interest rates and stronger U.S. economic growth to buoy Canadian exporters amid ongoing weakness in Canadian business investment.

However, the Bank again reduced its annual forecast for Canadian economic growth in light “a weaker outlook for business investment and a lower profile for exports reflecting a downward adjustment to US investment spending”. It also recognized how recent economic growth was reduced by the Alberta wildfires; however, it expects Canadian economic growth will pick up in the third quarter as oil production resumes.

The Bank also recognized that inflation has recently been running slightly higher than it previously expected but noted that inflation “is still in the lower half of the Bank’s inflation-control range”. It expects that the increase in inflation due to past weakness in the Canadian dollar will be temporary and will “dissipate in late 2016”.

While the Bank judges that “the risks to the profile for inflation are roughly balanced”, it expressed concerns about “the implications of the Brexit vote”, which it described as being “highly uncertain and difficult to forecast.” Its implications may ultimately result in the need to lower interest rates. However, lower interest rates would also likely further raise concerns the Bank has about Canadians’ “financial vulnerabilities [which] are elevated and rising, particularly in the greater Vancouver and Toronto areas.”

With all of these factors in mind, there is nothing in the Bank’s latest policy interest rate announcement to suggest that it will begin to raise interest rates until well into 2017 at the earliest.

As of July 13th, 2016, the advertised five-year lending rate stood at 4.74 per cent, up 0.1 from both the previous Bank rate announcement on May 25th and from one year ago.

The next interest rate announcement will be on September 7th, 2016, with the next update to the Monetary Policy Report to be released on October 19th, 2016.