OTTAWA, Aug. 16 /CNW/ - The Canadian Real Estate Association (CREA) says
national home sales activity continued to trend down in July 2010. The
decline was almost entirely the result of fewer sales in British
Columbia and Ontario. A slowdown in demand in these two provinces had
been widely expected in July, as many purchases were brought forward
into the first half of the year in advance of the introduction of the
Seasonally adjusted national home sales activity via the Multiple
Listing Service® (MLS®) Systems of Canadian real estate Boards was down
6.8 per cent on a month-over-month basis in July. The national decline
was smaller than the previous two months, as July sales in the Prairies
and Quebec came in on par with June levels. Declines in British Columbia
(-14.1 per cent) and Ontario (-8 per cent) accounted for 85 per cent of
the change in national activity in July.
Actual (not seasonally adjusted) national sales activity was 30 per cent
lower in July 2010 compared to last year's record July. Year-to-date
transactions are still up 5.6 per cent compared to the first seven
months of last year, although this gap is expected to continue to shrink
as the year progresses, since activity rose sharply over the second half
of last year, reaching levels that are unlikely to be matched in the
final five months of 2010.
New supply continues to adjust to lower demand. The seasonally adjusted
number of new residential listings on Canadian MLS® Systems declined by
7.2 per cent in July 2010 compared to the previous month. This is the
third consecutive month-over-month decrease, and the steepest in more
than a decade. Since reaching their most recent peak in April, new
listings have fallen 17.5 per cent.
The declining trend in new listings will help maintain the balance
between supply and demand, and temper home price volatility. The
national sales-to-new listings ratio, a measure of market balance, has
held steady between 48 and 49 per cent for the past three months, which
is characteristic of a balanced market.
The average price of homes sold via Canadian MLS® Systems in July was
$330,351, edging up one per cent from the same month last year. While
year-over-year comparisons have been shrinking as prices stabilize, the
national average home price is likely somewhat understated this month,
since the majority of activity declines occurred in British Columbia and
Ontario, which include many of Canada's most expensive markets.
The same phenomenon is widely known to have caused much of the downward
skewing in the national average price during the recession. This is most
evident when looking at a breakdown of average prices by province.
Average home prices eased slightly in Nova Scotia and Prince Edward
Island in July, but gains in every other province exceeded the national
The national weighted average price compensates for changes in
provincial sales activity by taking into account provincial proportions
of privately owned housing stock. It climbed four per cent on a
year-over-year basis in July 2010. Similarly, the residential average
price in Canada's major markets was up 2.9 per cent year-over-year in
July, while the weighted major market average price rose 7.4 per cent.
The number of months of inventory represents the number of months it
would take to sell current inventories at the current rate of sales
activity, and measures the balance between housing supply and demand. It
stood at seven months at the end of July 2010 on a national basis. This
is up from 4.4 months one year ago, which was one of the lowest levels
in the past three years.
The seasonally adjusted number of months of inventory stood at 7.3
months at the end of July on a national basis. This is the highest level
since March 2009, but the pace of monthly gains is slowing as new
listings continue to adjust to lower demand.
"The soft sales figures we're seeing right now can be attributed in part
to accelerated home purchases earlier in the year," said CREA President
"Activity may remain at lower levels for some time, but ultimately we
expect a more stable market to emerge, with demand coming back into line
with economic fundamentals."
"While the outlook for economic and job growth remains generally
positive nationally and in all provinces, the pace of the recovery will
vary by region," he added. "Buyers and sellers should consult with a
REALTOR® to find out about conditions in their local market."
PLEASE NOTE: The information contained in this news release combines
both major market and national MLS® sales information from
the previous month.
CREA cautions that average price information can be useful in
establishing trends over time, but does not indicate actual prices in
centres comprised of widely divergent neighborhoods or account for price
differential between geographic areas. Statistical information contained
in this report includes all housing types.
MLS® is a co-operative marketing system used only by Canada's real
estate Boards to ensure maximum exposure of properties listed for sale.
The Canadian Real Estate Association (CREA) is one of Canada's largest
single-industry trade associations, representing more than 99,000
REALTORS® working through more than 100 real estate Boards and
Further information can be found at cr="true" href="http://www.crea.ca/public/news_stats/media.htm">http://www.crea.ca/public/news_stats/media.htm
SOURCE The Canadian Real Estate Association
For further information: For further information:
Alyson Fair, Publicist
The Canadian Real Estate Association
P: 613-237-7111 or 613-884-1460