According to the Canadian Real Estate Association (CREA), Canadian home sales increased 1.8 per cent in November 2015 compared to October, reaching its highest monthly level in six years.
“Recently announced changes to mortgage regulations will likely boost sales activity in the short term, as buyers jump off the fence to beat the changes before they take effect next year,” said Pauline Aunger, CREA president, in a press release. “Even so, some housing markets stand to be affected by the changes more than others.”
“Changes to mortgage regulations taking effect in mid-February appear aimed at cooling the Greater Vancouver and Greater Toronto housing markets,” said Gregory Klump, CREA chief economist. “Minimum down payments will be going up for homes that sell for more than half a million dollars, so larger, more expensive housing markets will be affected most. Unfortunately, the regulatory changes will also cause unintended collateral damage to housing markets beyond Toronto and Vancouver, including places that are facing economic headwinds from the collapse in oil prices.”
Actual (not seasonally adjusted) sales activity increased 10.9 per cent year-over-year, which was also an increase from year-ago levels in two thirds of local markets. This increase is mostly due to sales activity in the Lower Mainland of British Columbia and the Greater Toronto Area, while sales activity in Calgary fell sharply due to the collapse in oil prices.
The number of newly-listed homes increased 3.1 per cent month-over-month from October. The sales-to-new listings ratio fell to 57.3 per cent in November, compared to 58 per cent in October, yet the number indicates that the housing market remains balanced.
The MLS Home Price Index increased 7.1 per cent over November 2014, which is the largest gain in over five years. Year-over-year price growth increased in all property types but were the strongest in two-storey single family homes, which posted an 8.88 per cent increase. Single-storey single family homes saw price increases of 6.42 per cent, while the price of townhouses increased 5.43 per cent. Apartment units saw the lowest price increases at 5.22 per cent.
The actual (not seasonally adjusted) national average home price in November was $456,186, which is a 10.2 per cent increase year-over-year. However, when excluding Greater Vancouver and Greater Toronto, the average price of a home falls to $338, 969, a 3.4 per cent increase year-over-year.