Canadian Existing Home Sales Rise in October

The number of transactions rose by 1.8 percent, the fastest since May, to 42,964, the Canadian Real Estate Association said from Ottawa Monday. Monday’s CREA report showed sales fell in about half of the markets it tracks across the country, and there is also a divide between a relative scarcity of single-family homes and an ample supply of condominiums.

The year-over-year price change for home sales in Canada has been led by a steady growth in the red hot real estate markets of southern B.C. and Greater Toronto, according to new statistics released by the Canadian Real Estate Association.

The national average home price rose 8.3 percent from October 2014 to C$454,976, pulled up by the disproportionately expensive homes in Toronto and Vancouver.

Ultralow interest rates have fed robust home sales in Canada for several years, feeding concerns about a housing bubble. The average residential sale price dropped in five of 10 provinces from a year ago, with Alberta and Saskatchewan among those markets seeing declines.

“The continuation of low interest rates is supporting home sales activity”, said Pauline Aunger, president at the CREA. “Even so, the strength of sales activity varies by location and price segment across Canada”. Single detached homes continue to be in short supply while demand for them remains strong in a number of active and populous housing markets in British Columbia and Ontario. The average sale price of a detached home in Vancouver almost doubled the national index price of $585,800.

Gregory Klump, CREA’s Chief Economist, says, “October extended resale housing market trends of recent months”.

Price gains were slightly more modest for condos, but greater Vancouver still saw the largest jump in prices in the country at 11.39 per cent. A typical apartment sold for $425,800 last month.

Calgary, Edmonton, Saskatoon and Regina all posted double-digit sales declines in October.

The national sales-to-new listings ratio was 57.9% in October, which indicates that the balance between supply and demand tightened. CREA says a sales-to-new listings ratio between 40 and 60 per cent is generally consistent with balanced housing market conditions.

There were 5.5 months of inventory at the end of October, down from 5.7 months in September.