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Ottawa, ON, July 17, 2017 – According to statistics released today by The Canadian Real Estate Association (CREA), national home sales cooled further in June 2017.
The number of homes sold via Canadian MLS® Systems fell 6.7% in June 2017, the largest monthly decline since June 2010. With sales having also declined in each of the two previous months, activity in June came in 14.1% below the record set in March.
June sales were down from the previous month in 70% of all local markets, led overwhelmingly by the Greater Toronto Area (GTA). Monthly declines were also posted in all surrounding Greater Golden Horseshoe housing markets, the Lower Mainland of British Columbia, Kingston, Montreal and Quebec City.
Actual (not seasonally adjusted) activity was down 11.4% on a year-over-year (y-o-y) basis, much of which reflected a significant drop in GTA sales activity. Nonetheless, half of all local housing markets recorded y-o-y sales declines. By contrast, Calgary, Edmonton, London and St. Thomas, Ottawa, Montreal and Halifax-Dartmouth topped the list of Canadian cities where home sales surpassed year-ago levels.
“Canadian economic and job growth have been improving, which is good news for housing demand,” said CREA President Andrew Peck. “However, it also means that interest rates have begun to rise, which may impact homebuyer confidence – particularly in pricier markets like Toronto and Vancouver where recent housing policies had already moved potential buyers to the sidelines. In lower priced markets, the effect of higher interest rates on housing affordability will be relatively muted. All real estate is local, and REALTORS® remain your best source for information about sales and listings where you live or might like to.”
“Changes to Ontario housing policy made in late April have clearly prompted many homebuyers in the Greater Golden Horseshoe region to take a step back and assess how the housing market absorbs the changes,” said Gregory Klump, CREA’s Chief Economist. “The recent increase in interest rates could reinforce a lack of urgency to purchase or, alternatively, move some buyers off the sidelines before their pre-approved mortgage rate expires. In the meantime, some move-up buyers who previously purchased a home before first selling may become more motivated to reduce their asking price rather than carry two mortgages.”
The number of newly listed homes slid 1.5% in June, led by a sizeable pullback in the GTA compared to record levels in April and May. A number of other markets in the Greater Golden Horseshoe also saw a pullback in new supply.
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