Canadian Housing Market Report: October 2013

Download CREA’s October Statistics Package: click to download Open in .PDF

Highlights:

  • National home sales declined by 3.2% from September to October.
  • Actual (not seasonally adjusted) activity came in 8.3% above levels in October 2012.
  • The number of newly listed homes declined by 0.8% from September to October.
  • The Canadian housing market remains in balanced territory.
  • The national average sale price rose 8.5% on a year-over-year basis in October.
  • The MLS® Home Price Index (HPI) rose 3.5% year-over-year in October

Bank Commentary Roundup

rbcRoyal Bank: We continue to project resale activity to remain largely static overall next year, although the in-year pattern is likely to show some cooling in latter part of the year as interest rates gradually rise.

We expect that the combination of flattening demand later next year and strong supply of newly completed condo units will rein in price increases in 2014. We project home prices to increase by less than 1% nationally next year.  (Full commentary)

scotiaScotia Economics:  This is the first drop in Canadian home resales since February. One month doesn’t make a trend, but it puts an end to the uninterrupted seven month string of sales gains since March.

On a very preliminary basis, this would feed into our view that sales rose over the spring and summer at the expense of future months as people exercised options to purchase within 90-120 day mortgage rate  commitments on fears of losing the juicy rate commitments back in the spring. I maintain the view that the  spring and summer market was a temporary interruption along a correcting sales path. (Full commentary)

bmoBank of Montreal: Looking past some of the wild swings (and the wilder headlines) seen in the  past year, the broader trends in the Canadian housing market are surprisingly calm. With total  sales basically flat versus a year ago so far in 2013 and almost every city sporting a modest,  single digit price gain, we can only ask: Where’s the fire? The moderation in national sales  from September’s hot level suggests underlying conditions remain balanced. Somewhat softer activity through the fall should avert another run-up in prices. (Full commentary)

TDTD Economics:  We are not anticipating a major housing correction.  There are several fundamental supports that should continue to keep the housing market stable – affordability remaining highly supportive by historical standards, for one.  Rather, we are expecting a flat pace of trend sales and price growth over the next two years which should allow incomes to play a bit of catch up.  (Full commentary)

One response to “Canadian Housing Market Report: October 2013

  1. Excellent round up and summary Mike. The bears will have to dream up something new to keep the renters content. Hey why don’t they try this one: “there’s a crash just around the corner…you’ll see.”

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