Statistics released today from the Canadian Real Estate Association report that home sales activity posted its fifth consecutive month-over-month decline in January 2014. The number of homes sold through MLS and other co-operative listing systems fell 3.3% on a month-over-month basis. Sales activity is 9.1% below the peak reached in August of 2013. According to CREA, sales were down on a month-over-month basis in more than 60% of all local markets.
January weather is referenced as a contributing factor to the lower sales numbers. CREA Chief Economist Gregory Klump noted that “Canadian housing market performance in January was a weather report of sorts, with January’s Polar Vortex having dented both resale activity and new construction.” CREA President Laura Leyser added that “a number of buyers likely waited out January’s deep freeze before going house hunting.”
Actual (not seasonally adjusted) activity stood 0.4% above levels posted in January of 2013, with year-over-year increases recorded in less than half of all local markets. Gains across most of British Columbia were offset by declines in Southern Ontario, Quebec, and much of the East Coast. The number of newly listed homes increased slightly in January, up 0.2% on a month-over-month basis. With sales down and new listings little changed, CREA reports that the national sales-to-new-listings ratio decreased to 52.4% in January, compared to 54.2% in December, which “remains well within balanced territory marked by the range from 40 to 60 per cent, as has been the case since early 2010.”
At the end of January, there were 6.4 months of inventory at the national level, an increase from 6.3 months at the end of December 2013. The number of months inventory is an important measure of balance between housing supply and demand, as “it represents the number of months it would take to completely liquidate current inventories at the current rate of activity.”
The actual national average sale price, not seasonally adjusted, was $388,553 in January, which is an increase of 9.5% over the same month in 2013. The MLS Home Price Index (HPI) provides a better gauge of price trends than the average price, since it isn’t affected by changes in the mix of sales activity. The Aggregate Composite MLS HPI rose 4.83% year-over-year, up from a 4.31% gain in December (see chart). The year-over-year price gains were led by two-storey single family homes (+5.57%), followed by one-storey single homes (+5.32%), townhouses and row units (+3.94%), and apartment units (+3.35%).
For additional information, please visit CREA’s website. If you’d like details on the Ottawa & Eastern Ontario real estate markets in particular, contact us directly or browse our website for a sales representative. Make sure you follow our Ottawa Real Estate Blog for the latest market updates!
