Canadian home sales rose 3.1 per cent from March to April to set a new record for the month, according to statistics released by the Canadian Real Estate Association (CREA).
April sales were up in about 70 per cent of all local markets, led by Ottawa and Edmonton. Meanwhile, activity remained steady in the Greater Toronto Area (GTA) and fell slightly in Greater Vancouver.
“National home sales set new monthly records over the past two months, even as activity in Greater Vancouver and the GTA appears to have topped out,” said Cliff Iverson, CREA president, in a press release. “With almost three-quarters of all local markets posting sales gains in April, there are plenty of other places where sales are climbing as we head into the busiest time of the year for homebuyers.”
“Supply shortages and tight housing market conditions have become self-reinforcing in the GTA,” said Gregory Klump, CREA chief economist. “The Greater Vancouver Area appears to be heading in that direction too. While significant home price gains may entice some homeowners in these markets to list their home for sale, the issue for many is that the decision to move means they would also be looking to buy while competition for scarce listings is fierce. As a result, many homeowners are deciding to stay put and continue accumulating capital gains. That’s keeping listings off the markets at a time when they are already in short supply.”
Actual (not seasonally adjusted) sales activity increased 10.3 per cent year-over-year to reach a new record for the month of April. It was also the second-highest level for transactions for any single month and was 16.5 per cent above the 10-year average for the month of April.
The number of newly listed homes fell by 0.2 per cent month-over-month in April 2016. The national sales-to-new listings ratio rose to 64.5 per cent, indicating the market is favouring sellers. This ratio was present in about half of all local housing markets, especially those in British Columbia, the GTA and in Southwestern Ontario.
The MLS Home Price Index (HPI) increased by 10.3 per cent year-over-year, which was the largest gain seen since May 2010. For the third consecutive month, year-over-year price growth was recorded across all property types. Two-storey single family home prices had the biggest year-over-year price increase at 12.3 per cent, while townhomes/row units had price gains of 9.8 per cent. Single-storey single family homes experienced price increases of 9.4 per cent, and condominium units had the smallest price gains at a still-noteworthy 7.9 per cent year-over-year.
The actual (not seasonally adjusted) national average price for homes sold in April 2016 increased 13.1 per cent year-over-year to $508,097, but is inflated thanks to sales activity in Greater Vancouver and the GTA. When excluding these two regions, the year-over-year price gain is reduced to 8.7 per cent.