Resale home activity caught a case of the winter sniffles in January, a further sign Canada's mighty residential real estate market is finally in a slowdown.
Last month, seasonally adjusted unit sales declined by 0.4 per cent from the month before and 8 per cent from January, 2007, according to data released Friday by the Canadian Real Estate Association (CREA).
“With the further dip in January, Canadian home sales are now well below year-ago levels, adding further evidence that the great boom is winding down,” said Douglas Porter, deputy chief economist at BMO Nesbitt Burns Inc., in a research note.
Steadily rising home prices have benched potential buyers, particularly in Alberta. In January, unit sales in Calgary dropped by 30.9 per cent from the year before and by 21 per cent in Edmonton. At the same time, new listings in those markets surged by 35.3 per cent and 61.1 per cent, respectively.
House resales were down 8 per cent in January from a year ago
Across the country, new listings hit a new record 51,716 units in January, rising 9.3 per cent from the previous month. It was the largest month-over-month increase in seven years, and puts the market into “more balanced” territory than it has been at any other point during that time, according to CREA.
Prices across the country did cool somewhat, with the average price rising 8.6 per cent year-over-year to $325,183. This was the smallest year-over-year price increase since December, 2006, and compares with an increase of 11 per cent for all of last year.
“The overall increase in new listings stemmed mainly from a jump in listings in some of Western Canada's most active markets. Price increases in those markets will be more modest compared to what we saw last year,” Gregory Klump, chief economist at CREA, said in a statement.
Price gains and sales activity varied widely from province to province.
Some of the country's weaker markets were in Alberta and parts of Ontario including Durham Region and St. Catharines & District.
Stronger markets included Newfoundland and Labrador, where home sales rose 47.5 per cent from the month before and the average price rose by 17.1 per cent.
Saskatchewan was also strong, with sales in Regina rising by 43.7 per cent while the average price rose 69.1 per cent, and in Saskatoon by 37 per cent with the average price up 36.5 per cent.
