According to statistics released
today by The Canadian Real Estate Association (CREA), national
resale housing activity retreated in January 2012 from the
strong finish reported for December 2011.
Highlights:
•Home sales were down 4.5% from December to January.
•Actual (not seasonally adjusted) activity came in 4.0% above
levels in January 2011, and stood even with the 5 and 10 year
averages for January sales.
•The number of newly listed homes edged down 1.4% from December
to January.
•With sales down by more than new listings, the national market
shifted further into balanced territory.
•The national average home price was up less than 2% year-over-
year in January, ranking it among the smallest increases of the
past year.
Sales activity recorded through the MLS® Systems of real estate
Boards and Associations in Canada fell 4.5 per cent from
December 2011 to January 2012. This marks the first monthly
decline in national activity since August 2011 and the biggest
monthly decline since July 2010. The monthly decline reversed a
string of monthly increases over the closing months of last
year, and returned national activity to where it stood at the
end of the third quarter of 2011.
“The national housing market is stabilizing and remains well
balanced,” said Gary Morse, CREA’s President. “That said,
forecasts for economic and job growth going forward vary widely
for different parts of the country, suggesting a possible
continuation of a softening trend in some markets, as well as
the potential that demand will pick up based on strong
fundamentals in others. All real estate is local, so talk to
your local REALTOR® to understand how price trends in your
neighbourhood are shaping up.”
Activity was down in over half of all local markets in January
from the previous month. Led by declines in Greater Toronto and
Montréal, demand also softened in a number of other major urban
centres including the Fraser Valley, Calgary, Edmonton,
Winnipeg, Ottawa, and Greater Vancouver.
Actual (not seasonally adjusted) national sales activity was up
four per cent from year-ago levels in January, the smallest
year-over-year increase since last May. As was the case in a
number of months last year, actual sales in January 2012 stood
close to the five and ten year average for the month.
The number of newly listed homes edged down 1.4 per cent on a
month-over-month basis in January following a 2.9 per cent
increase in December. The monthly decline in new supply reflects
a drop in new listings in a number of Canada’s largest urban
centres, which offset a jump in new listings in Vancouver.
Sales fell in January shifting the national market back towards
the mid-point of balanced territory and reversing the recent
trend which had seen the market becoming tighter over the final
four months of 2011. The national sales-to-new listings ratio, a
measure of market balance, stood at 53.8 per cent in January,
down from 55.5 per cent in December and 55.4 per cent in
November.
Based on a sales-to-new listings ratio of between 40 to 60 per
cent, 60 per cent of local markets were balanced in January.
Compared to December, there were fewer buyers’ and sellers’
markets, and a greater number of balanced markets.
The number of months of inventory stood at six months at the end
of January on a national basis, up from 5.7 months in December
2011 and returning it to where it stood in October 2011. The
number of months of inventory represents the number of months it
would take to sell current inventories at the current rate of
sales activity, and is another measure of the balance between
housing supply and demand.
The actual (not seasonally adjusted) national average price for
homes sold in January 2012 was $348,178, representing an
increase of 1.2 per cent from its year-ago level. This ranks
among the smallest increases since late 2010.
On a seasonally adjusted basis, the national average home price
rose 1.6 per cent on a month-over-month basis, marking a rebound
from a decline of similar magnitude in December. This pattern
mirrors the one playing out in the newly-launched MLS® Home
Price Index (HPI), published on February 6.
“Year-over-year comparisons in the national average price are
expected to become volatile and may turn negative, reflecting
average price developments in the first half of 2011 in
Vancouver,” said Gregory Klump, CREA’s Chief Economist. “At that
time, high-end home sales in Vancouver’s priciest neighbourhoods
surged to all-time record levels, which skewed the national
average price upward considerably. A replay of this phenomenon
is not expected this year. As a result, comparisons for national
average price to year-ago levels over the coming months will
reflect an upwardly skewed base effect. For this reason, year-
over-year comparisons should be kept in perspective.
Developments in the MLS® HPI will provide important guidance on
price trends, since it is not affected by the problem of
compositional shifts in the mix of sales activity.”
The MLS® HPI also takes into account the contributions toward
the price of a home made by a broad range of quantitative and
qualitative housing features, allowing it to track Canadian home
price trends better than any other measure.
PLEASE NOTE: The information contained in this news release
combines both major market and national MLS® sales
information from the previous month.
CREA cautions that average price information can be useful in
establishing trends over time, but does not indicate actual
prices in centres comprised of widely divergent neighborhoods or
account for price differential between geographic areas.
Statistical information contained in this report includes all
housing types.
MLS® is a co-operative marketing system used only by Canada’s
real estate Boards to ensure maximum exposure of properties
listed for sale.
The Canadian Real Estate Association (CREA) is one of Canada’s
largest single-industry trade associations, representing more
than 100,000 REALTORS® working through more than 100 real estate
Boards and Associations.
Further information can be found at
http://www.crea.ca/public/news_stats/media.htm.
To contact the reporter on this story:
Ilan Kolet in Ottawa ikolet@bloomberg.net
To contact the editor responsible for this story:
Marco Babic at mbabic@bloomberg.net
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