Tag Archives: national average price
Home listings reach all-time high
Number of homes sold, prices also surge as consumers flock to the market before new mortgage requirement and HST come into effect
Steve Ladurantaye – Globe and Mail
The Canadian real estate market reignited in March, with the number of new listings skyrocketing even as the number of sales and average prices crept toward all-time highs.
February data from the Canadian Real Estate Association showed sales and prices moderating as supply began to creep back into the market, but March numbers suggest Canadians are feverishly jumping into the market to sidestep tougher mortgage requirements in effect Monday April 19 as well as to avoid new taxes being introduced in Ontario and British Columbia in June.
There were 97,663 homes put up for sale last month, a 20% jump from the previous high set in March 2008. A total of 233,402 listings have been booked since the beginning of the year, the most for any first quarter on record.
New listings are important because they can help moderate sharp price increases that occur in a sellers’ market as buyers are forced to compete for what little inventory is available. That hasn’t happened yet, however, with sellers still in control in most of the country.
The national average price also spiked in March, hitting $340,920 – just $300 short of the all-time high reached last October. Compared to a year ago, the average price has gained 17.6%. CREA said 49,256 homes were sold, the second highest for any March and 40.8% higher than March 2008.
“Negotiations still favour sellers during the home buying process in a number of major Canadian housing markets,” said Georges Pahud, the association’s president. “[However,] the rise in new listings mean that buyers may shop around more before making an offer.”
In the first quarter, seasonally adjusted sales hit 130,072 homes, the fourth highest level on record. That’s a 3.4% decrease from the fourth quarter, when a sizzling market spurred talk of a bubble among economists and pushed the Federal government to enact tougher mortgage rules to ensure consumers would be able to afford their mortgages should interest rates rise.
Sales activity in Ontario, Quebec, and Newfoundland & Labrador rose to new records in the first quarter, but the gains were moderated by a sharp drop in sales in British Columbia as consumers began to be priced out of the market.
“The erosion of housing affordability is crimping activity in some of Canada’s priciest markets in the lower mainland of British Columbia,” said CREA chief economist Gregory Klump.
“Higher mortgage interest rates and the rise in new listings may also soon reduce some of the urgency to purchase in Toronto. Sales activity in British Columbia and Ontario is expected to ease over the second half of 2010 once the HST comes into effect, pulling national activity lower. Rising supply and lower activity will take the steam out of the pricing environment following upbeat home sales this spring.”
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Home sales surge 73 per cent
Average price rises 19 per cent in November, compared with a year ago
Steve Ladurantaye – Globe and Mail
National home sales increased by 73% in November from the trough seen a year ago, with Ontario and Quebec hitting new monthly records as buyers took advantage of record low interest rates to secure mortgages.
The national average price gained 19% compared to November 2008, at $337,231, the Canadian Real Estate Association said. Since the beginning of the year, prices have gained 4.4% compared to the same time last year.
“The year-over-year increase in November continues to reflect the high degree to which the average was skewed downward last year by plummeting activity in Canada’s priciest markets, and then upward by rebounding activity,” the association said in a statement.
CREA tracked 36,383 deals on its Multiple Listing Service in November. Crediting the housing market for leading “the overall Canadian economy out of the recession,” association president Dale Ripplinger said the numbers were a sign of an entrenched recovery.
“National home sales activity last month shows how strongly the housing market has rebounded since the beginning of the year,” he said.
About 437,507 homes have been sold through the CREA-owned MLS system so far this year, up 5% from last year at the same time, but lower than the previous three years.
One of the main drivers of price increases has been a lack of supply, but higher prices are beginning to draw more sellers into the market. Seasonally adjusted new listings rose 5% from October, to 69,110, in the largest gain since January 2008. There is still a dearth of supply however, with the number of homes for sale 23% lower than they were a year ago.
Comment: I wish we had 5% more listings here in Toronto! We are still down close to 50% from this time last year, making things very difficult for buyers.
The association’s economist, Gregory Klump, said as prices climb higher, would-be buyers may put off purchases, cooling off a hot market. Higher interest rates, expected in 2010, will also dampen their enthusiasm.
“Deteriorating housing affordability will rein in sales activity as the overall economy further improves and the pool of buyers who qualify for financing shrinks,” he said.
While sellers have no doubt been delighted by the premiums their homes have been fetching, a growing chorus of economists are expressing concern that the recovery isn’t sustainable.
“We’ve got a long way to go before we could put a bubble label on this market,” Merrill Lynch Bank of American economist Sheryl King said Monday.
“However, with mortgage rates at decades low – and even more attractive if home buyers choose the variable mortgage option which carries rates as low as 2.15% – the seeds of a bubble are definitely in place.”
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Contact the Jeffrey Team for more information - 416−388−1960
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Real estate sales across Canada set to reach new highs
Financial Post
November real estate sales across the country are set to reach new highs based on fresh data from the country’s two most expensive real estate markets.
The national numbers from the Ottawa-based Canadian Real Estate Association are not due out until mid-December but the Toronto Real Estate Board said yesterday it had its best November on record. Toronto’s news came on the heals of a Wednesday release from the Real Estate Board of Greater Vancouver that said sales activity in the city rocketed up 252.7% in November from a year ago.
What the latest numbers will likely mean is an improvement in the national average sale price, which was up 20% in October from a year ago — the largest such increase in two decades. The two cities tend to skew the national average price up or down, based on levels of sales activity.
“You are going to see a very strong national number. It will be another double-digit increase for sure,” said Benjamin Tal, senior economist at CIBC World Markets. “You have to remember you are comparing all this against a very low base. Last year at this time we were talking about 1929. This was a dead market.”
In November 2008, the greater Vancouver area had a meagre 874 sales. This November that figure was up to 3,083. But there are some indications the temperature in the red-hot housing market is dropping; Vancouver November sales were down 16.8% from October, although the numbers are not seasonally adjusted.
Toronto has a similar story to Vancouver. Canada’s largest market had 7,446 sales last month, almost double the number from a year ago, but down from the 8,476 in October.
Despite the lack of listings in the housing market, prices eased last month. The average sale price in Toronto last month was $418,460, a 14% jump from a year ago, but a drop from therecord high of $423,559 reached in October.
In Vancouver, the average price of a home reached $557,384 last month, a 12.4% increase from a year ago. But at that level, prices in Vancouver are actually down 1.9% from the peak reached in May 2008.
Re/Max, one of the country’s largest real-estate companies, issued its housing outlook for 2010 and though it still sees a strong market, both housing sales and prices are not expected to maintain their torrid pace. Re/Max says sales next year will climb by 2% while the average sale price across the country will rise to $325,000 for a 2% increase.
“There is a ton of business being done but nothing was being done in November [2008]. The whole world stopped last fall, not just the real estate world,” said Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada. “We should expect a very good year with a continued high number of sales. We don’t expect significant changes in interest rate levels.”
Record low interest rate levels have partially fuelled the real estate market and prices, but so have low inventory levels. In Toronto, inventory levels remain 49% down from a year ago with November 2009 new listings the same as a year ago. In Vancouver, the total number of listings is still down 39% from a year ago.
As for the interest-rate part of the puzzle, the Canadian Association of Accredited Mortgage Professionals latest statistics show consumers could find themselves exposed. In the past 12 months, only 20% of consumers opted for a variable-rate product but the overall numbers show 27% of Canadians still have mortgage tied to prime. “There is no questions rates and affordability have contributed to the market,” said Jim Murphy, president of CAAMP.
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Contact the Jeffrey Team for more information - 416−388−1960
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Related posts:
- Toronto real estate sales up 84% in first half of month Existing home sales in the Toronto area in the first…
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- Correction, not crash for Canadian real estate market in 2009 Historically low interest rates, stable local economies and increasing affordability…
