Photo: Kurt Bauschardt/Flickr
While Canadian home sales dipped month-to-month from June to July, the total number of homes sold in July was still the second highest figure for the month since 2009.
National home sales fell a modest 0.4 per cent in July over the previous month, but actual sales activity was up 3.4 per cent over July 2014. That’s according to the Canadian Real Estate Association’s (CREA) latest monthly report released Friday covering home sale transactions through MLS systems across the country.
Sales were down from June in half of the local markets covered, with Hamilton-Burlington and the Greater Toronto Area’s Durham region seeing the largest drops in sales. CREA chalked up the decline in these two markets to an insufficient supply of listings. Both markets saw record levels of sales activity in June. Meanwhile, sales in Newfoundland and Labrador saw the largest month-to-month increase in July, with the market rebounding from a quiet June.
When compared to July 2014 activity, BC’s Lower Mainland and the GTA saw the largest year-over-year sales increases. Calgary continued to see the largest decline in sales relative to year-ago levels.
“National sales activity remains solid, fuelled by strength in British Columbia and the Greater Toronto Area, where listings are in short supply or trending that way,” said CREA President Pauline Aunger in a press release.
“That said, markets elsewhere across Canada are largely well balanced and in some cases have an ample supply of listings.”
CREA’s Chief Economist Gregory Klump said that the strength of national home sales remains a story about two cities, the GTA and the Lower Mainland. However, it’s also important to acknowledge how the trends in the two cities are “spreading out in their respective provinces.”
“[T]he national picture reflects how demand is running high for the short supply of single family homes in and around the GTA while the balance between supply and demand is tightening in BC’s Lower Mainland.”
“Trends in British Columbia and Ontario have a big influence on the national figures, since they account for about 60 per cent of national housing activity,” Klump said. “As a result, the national picture reflects how demand is running high for the short supply of single family homes in and around the GTA while the balance between supply and demand is tightening in BC’s Lower Mainland. These remain the only places in Canada where home prices are growing strongly.”
CREA’s MLS House Price Index rose 5.9 per cent year-over-year in July, a slight acceleration from the year-over-year gain seen in June. The largest price gains were seen in the country’s two most robust markets. Greater Vancouver saw an 11.23 per cent year-over-year rise in prices while Greater Toronto saw a 9.39 per cent increase.
Home price growth in Calgary continued to slow, with the city recording an increase of just 0.14 per cent year-over-year. It was the smallest gain in nearly four years. To illustrate how much difference a year can make, in CREA’s July 2014 report, Calgary home prices had seen a 10.48 increase over July 2013.
The actual national average home price for homes sold in July 2015 was $437,699, up 8.9 per cent year-over-year. If Greater Vancouver and Greater Toronto are excluded from the calculation, the average home price drops to $341,438 for a year-over-year increase of 4.1 per cent.
CREA prefers the MLS House Price Index over the actual average home price as it is “a better gauge of price trends than is possible using averages because it is not affected by changes in the mix of sales activity the way that average price is.”