Residential property sales in Canada increased in June compared with the previous month but are still well down on a year ago while prices also fell on an annual basis, the latest index shows.

Overall sales increased by 4.1% from May to June but activity is down 10.7% from June 2017, according to the data from the Canadian Real Estate Association (CREA). It is the first time that sales have increased month on month this year, but transactions are still significantly down from monthly levels recorded over the last five years.

The figures also show that the national average price decreased by 1.3% year on year to $496,000. However, the national average price is heavily skewed by sales in the Greater Vancouver and GTA, two of Canada’s most active and expensive markets. Excluding these two markets from calculations cuts almost $107,000 from the national average price, trimming it to just over $389,000.

More than 60% of all local housing markets reported increased sales activity in June compared to May, led by the Greater Toronto Area (GTA). By contrast, sales in British Columbia continued to moderate.

The data also shows that overall sales are at a five year low and were almost 7% below the 10 year average for the month of June. Activity came in below year ago levels in about two thirds of all local markets, led overwhelmingly by those in the Lower Mainland of British Columbia.

‘This year’s new stress test on mortgage applicants has been weighing on homes sales activity; however, the increase in June suggests its impact may be starting to lift,’ said CREA president Barb Sukkau.

But Gregory Klump, CREA chief economist thinks that sales may be starting to turn the corner. ‘Even so, the number of homes trading hands has a long way to go before it returns to levels posted in recent years. Looking ahead, home sales activity and price gains will likely be held in check by higher interest rates,’ he added.

The index also shows that the number of newly listed homes fell by 1.8% in June, and also stood below levels for the month in recent years. New listings declined in a number of large urban markets, including those in British Columbia’s Lower Mainland, Calgary, Edmonton, Ottawa and Montreal.

Overall the house prices index was up 0.9% year on year, the 14th month in a row of decelerating gains. It was also the smallest increase since September 2009. While prices in the Greater Golden Horseshoe (GGH) housing markets have begun to stabilise and trend higher on a month on month basis in recent months.

Prices for apartments have risen the most, up 11.4% year on year while townhouses rose by 4.9%, but price growth has slowed in both these sectors. Prices for one storey and two storey family homes fell by 1.8% and 4.1% respectively.

Overall, prices have risen year on year in eight of the 15 markets tracked by the index, but price trends continue to vary among housing markets. For example, growth is moderating in the Lower Mainland of British Columbia and slowing considerably in the GGH region.

The biggest annual price growth was in the Fraser Valley with a rise of 18.4%, followed by Vancouver Island up 16.5%, Victoria up 10.6% and Greater Vancouver up 9.5%. In the GGH region prices rose annually by 3.5% in Guelph but fell by 6.5% in Barrie, by 4.8% in GTA and by 2.9% in Oakville-Milton.

Prices also fell in Calgary and Edmonton, down 1% and 1.5%, while they also fell by 6.1% in Regina and by 2.9% in Saskatoon. But they increased by 7.9% in Ottawa, by 6.4% in Greater Montreal and by 6% in Greater Moncton.

Property Sales Increase in Canada for First Time in 2018 But Still at 5-Year Low by Property Wire