MLS new residential listings in Canada’s major markets retreated in August 2008 from record levels in the previous four months, according to statistics released by The Canadian Real Estate Association (CREA). With new listings down from the peak, the resale housing market is stabilizing.
After four consecutive months in which new MLS residential listings topped 50,000 units, some 47,657 homes were listed via MLS on a seasonally adjusted basis in August 2008. This is a decline of 5.3 per cent compared to the previous month. New listings having eased in many major centres, and now stand at their lowest level this year.
This trend has been most evident in Calgary and Edmonton, where fewer new listings and rising sales activity have stabilized the resale housing market. New listings remain most elevated relative to sales activity in Saskatoon and Vancouver, making them the most balanced major markets in the country.
Seasonally adjusted MLS sales activity in Canada’s major markets edged down by 3.4 per cent on a month-over-month basis to 24,887 units in August 2008. The number of transactions was down in every market except Calgary, Edmonton and Regina, with Vancouver posting the largest decline in sales activity.
Sales activity in August was down from year-ago levels in the five most expensive major markets in Canada – Vancouver, Victoria, Calgary, Toronto and Edmonton. As a result, the overall major market MLS residential average price posted another year-over-year decline in August, despite the fact that average prices recorded year-over-year gains in 20 of 25 major markets.
“When comparing statistics, remember 2007 was a record year for real estate sales in Canada,” says CREA President Calvin Lindberg. “In light of that fact, our current market can certainly be characterized as stable.”
“The Canadian market fundamentals are still solid, and mortgage rates are still at near record low levels,” the CREA President adds. “The challenge is for sellers to price their home to meet the local market realities, and for buyers to realize there is no real estate bubble that will burst and send prices to new lows.”
The average sale price of residential properties sold via MLS was $316,052 in August. This is 5.1 per cent below where it stood in August last year. Five major markets saw year-over-year declines in average price in August: Vancouver, Victoria, Calgary, Edmonton, and Windsor.
“Price declines in the pricier major markets are pulling down the overall average price,” said CREA Chief Economist Gregory Klump. “Significantly lower sales activity in Greater Vancouver compared to a year ago means that the most expensive market in Canada now has less weight in the overall average price calculation,” he explained.
“Sales activity is down in a number of resale housing markets in Western Canada that earlier posted hefty price increases. Prices continue rising in other markets where price gains have been more modest,” said Klump. (CREA 15/09/08)