Download the full CREA statistics report for January: click here
- National home sales fell 3.3% from December to January.
- Actual (not seasonally adjusted) activity stood 0.4% above January 2013 levels.
- The number of newly listed homes edged up 0.2% from December to January.
- The Canadian housing market remains in balanced territory.
- The national average sale price rose 9.5% on a year-over-year basis in January
- The MLS® Home Price Index (HPI) rose 4.8% year-over-year in January.
Year-over-year price growth in the MLS® HPI was mixed across housing markets tracked by the index. Calgary (+8.98 per cent) and
Greater Toronto (+7.06 per cent) again posted the biggest price gains.
Greater Vancouver recorded a third consecutive year-over-year increase (+3.18 per cent) after more than a year of declines between late 2012 and late 2013. While prices in Victoria remained lower than year-ago levels, January’s decline (-1.37 per cent) was the smallest in more than three years.
TD: No doubt the frigid temperatures and heavy snowfall across much of the country prevented many from diving in to the January market. As such, when the spring thaw (finally) makes its way across Canada, a bounce back in sales activity would be entirely unsurprising. Indeed, the upcoming spring market could get an additional boost as prospective buyers lock-in to the recent pullback in mortgage rates.
However, it is worth noting that mortgage growth has slowed significantly over the last year as an increasing share of buyers are priced out of the in-demand, but expensive single-family market. In recent months, there has been a clear shift towards this market at the expense of the less-expensive condo segment, a trend that is largely responsible for the divergence between rapidly falling sales and continued records in average prices.
All said, with household indebtedness still at lofty levels and interest rates expected to grind higher over the course of this year, we continue to anticipate a soft landing in the housing market. (Read full commentary)
BMO: Prices remain surprisingly sturdy, however given the sustained slowdown in sales, we would continue to look for an eventual cool-down in price gains. The old rule of thumb is that prices follow sales with about a six-month delay.
Old man winter likely put a serious chill into January home sales, but underlying activity looks to be simmering down in any event. Despite the gaudy price increases in January, we suspect that pricing power will eventually follow the sales lead. (Read full commentary)
Royal Bank: While poor weather could well have disrupted resale activity in January (and possibly December), developments since early fall suggests to us that the surprisingly strong market rally in the spring and summer last year partly comprised a transitory element that has now run its course. We believe that once the more recent weather related setbacks are reversed in the coming months, the market will maintain an avearge “cruising speed” that will be neither too hot nor too cold and such that total 2014 resales in Canada will be only modestly stronger in 2013. Our outlook for 2014 calls for resales to rise by just 0.6%…we project home prices to increase by 1.5% nationally.
We expect home resales in markets in Alberta to benefit from a boom economy (and population growth) and continue to grow strongly in 2014.
As we warned previously, any acceleration in the rate of property appreciation much beyond personal income growth (which averaged a little more than 4% overall in Canada in the past two years) could be detrimental to housing affordability. To date, affordability trends have been generally static at modestly stretched levels, although some deterioration occurred in markets such as Toronto. (Read full commentary)