Monthly home sales are on the rise for the first time in seven months according to the latest insights from the Canadian Real Estate Association (CREA).
In its National Statistics report for September, CREA reported the number of monthly sales across Canada increased by just less than one per cent, the first month-to-month increase recorded since March. While the quantity of new homes hitting the market slid slightly from August to September, property prices continue to rise on an annual basis.
Here’s what CREA had to say about the Canadian housing market for the month of September.
National monthly sales nudge up less than 1%
From August to September, recorded home sales climbed by 0.9%, the first increase since March, according to CREA. On a yearly basis, sales dropped 17.5%, down from 2020’s record-setting month for September, but still the second-highest ever sales figure for the month.
“September provided another month’s worth of evidence from all across Canada that housing market conditions are stabilizing near current levels,” said Cliff Stevenson, chair of CREA. “In some ways that comes as a relief given the volatility of the last year-and-a-half, but the issue is that demand/supply conditions are stabilizing in a place that very few people are happy about.”
Total home inventory hovers around two months worth
Month-to-month, the quantity of new homes coming onto the market dropped by 1.6%. Property gains in Quebec were overshadowed by declines recorded within the Lower Mainland, Calgary and the Greater Toronto Area.
By the end of September, there was 2.1 months worth of inventory available nationwide, a small drop from 2.2 months worth in August and 2.3 months in June and July.
“This is extremely low and indicative of a strong seller’s market at the national level and in most local markets,” said the report. “The long-term average for this measure is more than five months.”
With sales creeping up slightly in September as home quantities declined, the sales-to-new listings ratio grew to 75.1%, up from 73.2% in August. CREA noted that a “small but growing majority” of local markets are moving back into seller’s market territory.
September price acceleration “not surprising”
The actual (not seasonally adjusted) national average home price was $686,650 in September 2021. This is an increase of 13.9% from the same period last year.
When excluding Greater Vancouver and the GTA, two of Canada’s most expensive real estate markets, the national price average for September falls by $146,000 to approximately $540,650. Tighter market conditions pushed the Aggregate Composite MLS Home Price Index up by 1.7% month-to-month in September.
Shaun Cathcart, CREA’s senior economist, noted that home price behaviour will be worth keeping an eye on with the national market “still stuck” at around two months worth of inventory.
“While the acceleration in home prices we saw in September was more than most would have expected, the fact that prices are now moving back in that direction is not surprising,” he said.
Provincial and local price growth differed
Across the country, several provinces observed high annual price growth, but increases were less consistent between communities.
In British Columbia, year-over-year price growth is said to be “creeping up above 20%,” but these increases are lower in Vancouver. Levels in Victoria were on par with the provincial average, while other areas hit above the average in September.
Last month, year-over-year price increases were pushing 25% in Ontario. However, much like British Columbia, growth was much lower in bigger cities the GTA and Ottawa. Oakville-Milton, Hamilton-Burlington and Guelph saw prices grow closer to the provincial average.
Yearly price growth in Greater Montreal has stayed at a little over 20%.
What We Learned from September Home Sales by Michelle McNally | Livabl