December home slump caps weakest annual sales since ’12
Canadian home sales in December were down for a fourth month in a row, capping the weakest annual sales since 2012, the Canadian Real Estate Association said Tuesday. The association said home sales fell 2.5 per cent on a month-overmonth basis in December, reaching 36,759 on a seasonally adjusted basis. Compared with December 2017, home sales in the final month of 2018 were down 19 per cent. CREA president Barb Sukkau attributed the drop to a rush of buyers at the end of 2017 ahead of tighter mortgage rules that came into force on Jan. 1, 2018. “The stress-test has weighed on sales to varying degrees in all Canadian housing markets and will continue to do so this year,” she said in a statement.
CREA said December home sales were down from a year ago in three-quarters of all local markets, led by B.C.’s Lower Mainland, the Okanagan, Calgary, Edmonton, the Greater Toronto Area and Hamilton-Burlington in Ontario. It said the national average price for homes sold in December was down 4.9 per cent year-over-year, reaching $472,000. Excluding Greater Vancouver and the Greater Toronto Area, two of Canada’s most active and expensive markets, the average sale price was just under $375,000. BMO Capital Markets senior economist Robert Kavcic took the sales and prices dip to be signs that the market has softened and “the headline-grabbing drama in recent years has largely run its course.” “It’s probably not a stretch to think that the Canadian housing market has entered into a prolonged period of relative stagnation, where sales are roughly flat and prices no longer outrun inflation,” he wrote in a note to clients. “This would be a big change compared to conditions we’ve experienced over the past decade, especially in Toronto and Vancouver, but it’s not at all uncommon when looking back through history and across different markets.” Vancouver, he said, finished the year at the lowest seasonally adjusted level since the Great Recession, leaving buyers in control.