All News

Canada housing market closes year on high note

January 19, 2012

Residential resale activity in Canada rose 1.8% from November to December, according to data released this week by The Canadian Real Estate Association (CREA), marking the fourth consecutive monthly increase. Activity rose in more than half of all local markets, including some of Canada’s most active. Actual (not seasonally adjusted) national sales activity came in 4.6% above levels recorded in December 2010.

Looking at 2011 on the whole, a total of 456,749 homes traded hands via the Canadian MLS® Systems in 2011. This stands broadly in line with the average over the past ten years, and represents an increase of 2.2% from annual levels reported in 2010.

“The momentum in sales activity provides clear evidence that low interest rates continue to draw homebuyers to the housing market,” said Gary Morse, CREA President. “While buyers have become increasingly cautious, the hand off for sales activity going into the New Year suggests that Canada’s housing market will continue to benefit from low interest rates in 2012, and continue making a significant contribution to Canadian economic activity.

The number of newly listed homes rose 3% on a month-over-month basis, reversing an equivalent monthly decline in November. New listings rose in almost 70% of local markets, including some of Canada’s most active.

The actual (not seasonally adjusted) national average price for homes sold in December 2011 was $347,801. This stood just 0.9% above the average selling price in December 2010, marking smallest increase since October 2010. “Momentum for national sales activity and average price remains positive but is slowing, which suggests that the continuation of low interest rates is not causing the Canadian housing market to overheat,” said Gregory Klump, CREA’s Chief Economist. “High end home sales seem unlikely to spike again in the first quarter like they did at the beginning of 2011, so national average price momentum may wane further over the next few months. With interest rates widely expected to remain low throughout 2012, homeownership will remain affordable, and continue to support home sales activity.”

ICREA