April shows lower housing sales in Canada after record high numbers
Last month, real estate sales were down in Canada following record results seen in March. The decline was caused by a new wave of COVID-19 cases and lockdowns.
According to the Canadian Real Estate Association (CREA), national home sales fell by 12.5% from March, while the number of new listings went down by 5.4%. However, CREA’s Home Price Index rose by 2.4% over a month, with the seasonally adjusted national average home price reaching $723,500. It’s 23% higher than a year ago and 56.7% higher than 5 years ago. Nevertheless, it’s still lower than the 3% increase seen in March, and February’s 3.3% gain.
The average home price rose by 41.9% annually to $696,000, marking a 2.9% decline from March’s $716,828.
During the previous year, we’ve seen the national real estate market rising to records, as extremely low interest rates and a strong demand for larger properties have attracted more people into the market than usually. However, last month, most of the country was facing a new wave of coronavirus, which has led to new restrictions.
Cottage-oriented markets of Ontario showed the fastest annual prices gains exceeding 40%. Kawartha Lakes saw its average home price rising by 5% monthly and by 48% annually to $582,100.
“Although the real estate markets across the country are still very active, there are more and more signs that the last year’s imbalances are starting to disappear,” – noted Cliff Stevenson, chair of the realtor group. “Many regions have enacted new lockdowns, making it more difficult to analyze the demand and supply.”
The decline in demand slowed down the market slightly. Canada had almost 2 months worth of housing supply available, which is up from a record low of 1.7 months reported in March. Nevertheless, it remains lower than the long-term average of five months.
The construction sector also showed certain cooling, with Canadian home starts going down by 20% last month. However, CMHC says they are stull historically elevated.