The Canadian Real Estate Association (CREA) released its national home sales report for December 2017, announcing another month of increased activity.
Despite the typically slow season, December 2017 was the fifth consecutive month of increased sales activity reported through Canadian MLS systems. From November to December, home sales increased 4.5%! Year-over-year, December sales increased 4.1%.
That said, the Greater Toronto Area (GTA) saw a slight decrease in sales compared to the same period the previous year.
“Monthly momentum for national home sales activity gained strength late last year and further expected economic and job growth will buoy sales activity this year despite slightly higher expected interest rates,” says CREA President Andrew Peck.
“Even so, momentum for home sales differs depending on location and type,” he adds. “A professional REALTOR® is your best source for information and guidance in negotiations to purchase or sell a home during these changing times.”
New listings on a national level increased 3.3%, mostly due to a surge of new supply in the GTA. The sales-to-new listings ratio for all of Canada is 50%. The CREA considers a ratio between 40% and 50% as balanced.
There were 4.5 months of inventory in Canada as of the end of the year. In the Greater Golden Horseshoe (GGH), there were 2.1 months, which is much higher than the all-time low of 0.9 months seen last year, but still under the long-term average of 3.1 months.
“National home sales in December were likely boosted by seasonal adjustment factors and a potential pull-forward of demand before new mortgage regulations came into effect this year,” explains Gregory Klump, CREA’s Chief Economist. “It will be interesting to see if monthly sales activity continues to rise despite tighter mortgage regulations that took effect on January 1st.”
Unsurprisingly, apartment units saw the largest year-over-year price gain last December, with the average increasing by 20.5%. Townhomes followed with a 13% increase, then bungalows trailed with a 5.5% jump, and two-storey detached homes increased 4.5%.
In the GTA, price growth continued to slow in December, but year-over-year Toronto home prices were up 7.2% and Guelph’s average price was 13.1% higher. The Oakville–Milton area actually had a decrease of 0.8%.
On a national level, the average price of a home was $496,500. As usual, pricing in the GTA and Vancouver severely altered the average. Remove these two regions from the equation and the average home price would be $381,000.
We’ll be keeping our eye out for the Building Industry and Land Development Association’s (BILD) first report of the year to see if the new home market also saw an uptick in sales last December.