Canadian resale housing market continues to recover in April
 

Resale housing market continues to recover in April
Published May 14, 2009 CREA

MLS® home sales activity increased for the third time in as many months in April 2009, according to statistics released by The Canadian Real Estate Association (CREA). The national average price also rose in April, to within short reach of the record levels reached one year ago.

Seasonally adjusted national home sales activity climbed 11.2 per cent in April 2009 compared to the previous month. This is the largest month-to-month increase in activity in more than five years. MLS® home sales activity reached its highest level in seven months, with 34,838 units trading hands nationally via the MLS® in April on a seasonally adjusted basis.

The increase in April builds on gains of 10.3 per cent in February and 7.7 per cent in March. Seasonally adjusted activity now stands 32 per cent above the lowest level in a decade that was recorded in January 2009.

Seasonally adjusted sales were up from March levels in 70 per cent of local markets, with gains in Toronto (10 per cent), Vancouver (30 per cent), Montreal (15 per cent), and Calgary (31 per cent) contributing most to the overall increase in monthly activity.

Actual (not seasonally adjusted) MLS® home sales totaled 43,473 units in April 2009, down 11.8 per cent from the same month one year ago. Year-over-year declines have been shrinking since dropping a record 42.2 per cent in November 2008.

“REALTORS® know that several factors have led to this market situation,” says Regina Broker Dale Ripplinger, President of The Canadian Real Estate Association. “First, price adjustments in some markets have helped affordability. Second, lenders do have money for people and properties that qualify, although some are being more stringent. The third factor involves consumer confidence, which has risen in the housing market through the Spring.”

The last factor, CREA’s President adds, is that sellers have realized that realistic pricing is key, and that is very much driven by local factors. “Homes are only worth what a buyer is willing to pay.”

The national MLS® residential average sale price in April ($306,366) stands 3.2 per cent below April 2008, when it reached its pre-recession peak. The MLS® residential average price broke all previous monthly records in Saskatchewan, Manitoba, Quebec, and Nova Scotia.

The supply of homes coming onto the MLS® market continued trending downward in April. Seasonally adjusted MLS® residential new listings edged lower by 1.8 per cent from the previous month to 66,843 units, the lowest level since June 2006. Seasonally adjusted new residential listings in April were 16.4 per cent below the peak reached in May 2008.

With sales activity rising strongly and new listings trending downward, the balance between supply and demand is firming up in British Columbia, Alberta, Ontario, and Quebec. As a result, in April 2009 national sales as a percentage of new listings reached the highest point since February 2008.

The residential dollar volume for MLS® sales climbed 12.3 per cent from the previous month to reach $10.2 billion. This is the biggest increase since December 2001, and first time since September 2008 that dollar volume surpassed $10 billion.

“If the trend for MLS® sales activity over the past few months persists, the number of transactions in May could surpass the pre-recession levels of September 2008,” said CREA Chief Economist Gregory Klump. “In the recessions of the early 1980s and 1990s, sales activity bottomed out before the job market or even the economy did. Improved affordability may result in Canadian existing home sales leading the economic recovery this year.”

Re: Canadian resale housing market continues to recover in April
 

Is it rich folk swooping in to grab good deals and expand property empires MB? Or first timers taking advantage of the interest rates?

Re: Canadian resale housing market continues to recover in April
 

From my own personal experience its first time buyers that are keeping the Winnipeg market as active as it is.

Re: Canadian resale housing market continues to recover in April
 

Glad to hear it - and that you're keeping busy :D

Re: Canadian resale housing market continues to recover in April
 

The interest rates are certainly a huge deal right now. The market is pretty active at the moment around us in Vancouver, a couple of the properties we've watched sell recently have gone for over the asking price due to multiple offers; first time for that in a while.

Re: Canadian resale housing market continues to recover in April
 

i understand that the stock of houses up for sale (in BC) is the lowest it has been in a long while, as owners wait for things to pick up. demand will see the prices turn i guess.

as a wouldbe first time buyer, i am feeling bummed out that this occurred before recruitment took off again. always the way eh?

Re: Canadian resale housing market continues to recover in April
 

As I understand it the canadian stats aren't mix adjusted - and the volumes are still very low - so it's difficult to see what the prices are really doing (i.e. not much happening at the bottom end of the market will skew the price up).

I can only speak for Greater Vancouver - but it's not possible for average first time buyers to be paying the prices seen here - unless they are very rich or are *****ing idiots who want to spend their lives in penury that is. Although I do notice a tendency for Canadians not to question those in positions of authority or 'expertise' - so maybe that's why they believe a realtor who's assessment is usually just adding a bit on to the price of the last similar house they sold.

All this talk of recovery is making me very nervous - we seem to have borrowed ourselves rich which can't possibly be good. Personally I reckon this is a dead cat bounce due to rich buyers moving out of cash and into real-estate.

Re: Canadian resale housing market continues to recover in April
 

You see a lot of talk about pent up demand - I guess there is also a lot of pent up supply :p

Re: Canadian resale housing market continues to recover in April
 

I don't think a house is a realistic first time buyer purchase in the lower mainland. Not unless you have wads of cash from the parents or have an inheritance. Or earn a lot of $$$$. Or buy a house with friends and split it.

The first time buyer purchase is a condo, 1 or 2 bedrooms. I know of quite a few young families who have started out in a condo, incl. me.

Re: Canadian resale housing market continues to recover in April
 

Guess so - tho the price differentials are sill so huge stepping up is looks to be prohibitively expensive .... especially if you bought in the last year or two.

Re: Canadian resale housing market continues to recover in April
 

Male Cows.

A quick search of Vancouver reveals 12 homes under 500K, which is within the reach of some 1st time buyers. (please feel free to debate this point with me, after all I dont have a clue what I'm talking about I only sell homes to 1st time buyers at the end of the day.)

Re: Canadian resale housing market continues to recover in April
 

500k - so average family income of say $100k will have to stretch to a 5x mortgage and hope they both keep their jobs? That isn't affordable - that's insane.

Re: Canadian resale housing market continues to recover in April
 

Agreed. $500k for a first time buyer is just ridiculous, even if the banks allow it.

Re: Canadian resale housing market continues to recover in April
 

1) 100% mortgages dont exist so that shoots you down.
2) Did you miss the use of the word SOME?

Why is 500k anymore ridiculous for a first time buyer than it is for someone buying their 5th or 6th home?



And since the statement was made in reference to the lower mainland if we zoom out we find in the area Richmond east to Maple Ridge, White Rock north to Coquitlam there are 259 single family properties below 400k.

Re: Canadian resale housing market continues to recover in April
 

So... "Some" FTB's will be able to afford $10M+ condos - what's your point exactly?

500k is ridiculous because it's a vast amount of money. Have we become so used to being in debt with these numbers that it's lost all meaning? Remember if you borrow that much money, you are drawing down your future income and 500k is a lot of work to commit to doing over the next 25 years - almost usury I would say. Anyone taking on that much debt is welcome to it and the effective slavery it brings.

Edit to add: Oh I missed the bit about 100% mortages - so yes you are right 450k, that makes all the difference!