It looks like fall is off to a good start with the Canadian housing market continuing to gain momentum as home sales and prices edge upwards.
According to the Canadian Real Estate Association, home sales reported through national MLS systems in September 2019 increased 15.5% year-over-year, and came in 18% above the six-year low hit in February 2019. The Greater Toronto Area and Hamilton-Burlington contributed greatly to the slight increase in national home sales.
"National sales activity has begun to rebound in recent months," says Jason Stephen, president of CREA. "That said, all real estate is local, so there's a lot of variation in the strength of the rebound depending on the housing type, location and price segment. Nobody knows that better than a professional REALTOR®, your best source for information and guidance when negotiating the sale or purchase of a home."
As sales increased, new listings fell slightly by 0.6%, which led to tighter conditions on a national level. As of the end of September, there were 4.5 months of inventory available across the country, which is the lowest level since December 2017. The long-term average for national home supply is 5.3 months.
It’s important to remember that markets vary across Canada, so some markets, like the Prairies and Newfoundland and Labrador, are oversupplied, while other places like Ontario are in need of more supply.
On a national level, the average price of a two-storey single-family home increased 1.7% year-over-year, followed closely by one-storey single-family homes increasing 1.4%. The average price of an apartment went up slightly by 0.7% year-over-year and townhomes went up 0.4%. The CREA says that home prices in the Greater Golden Horseshoe are rebounding.
The national average home price increased 5.3% year-over-year to approximately $515,500. When you remove Greater Vancouver and the GTA from the equation, the average price falls to just under $397,000.
"Home sales activity and prices are improving after having weakened significantly in a number of housing markets," says Gregory Klump, CREA's Chief Economist. "How long the current rebound continues depends on economic growth, which is being subdued by trade and business investment uncertainties."
With buyers finally adjusting to the mortgage stress test and the busy fall season upon us, we’re eager to see how well Canada’s housing market does through the next couple months.