{"id":10033,"date":"2017-02-15T16:22:03","date_gmt":"2017-02-15T21:22:03","guid":{"rendered":"http:\/\/www.zoocasa.com\/blog\/?p=10033"},"modified":"2017-02-15T16:25:55","modified_gmt":"2017-02-15T21:25:55","slug":"canadian-january-2017-home-sale-down-slightly","status":"publish","type":"post","link":"https:\/\/www.zoocasa.com\/blog\/canadian-january-2017-home-sale-down-slightly\/","title":{"rendered":"Canadian January 2017 Home Sales Down Slightly: CREA"},"content":{"rendered":"

The number of Canadian real estate<\/a> sales declined by 1.3% last month, and were down in half of all local markets \u2013 but don\u2019t blame it on a lack of interested buyers, reports the Canadian Real Estate Association.<\/p>\n

CREA\u2019s January numbers<\/a> reveal sales have dipped to the second lowest monthly level since Fall 2015, hovering\u00a0just slightly higher than in November, when the CMHC\u2019s new mortgage stress test took effect.<\/p>\n

Supply Cramping Housing Market Growth<\/h2>\n

One of the biggest issues, says Chief Economist Gregory Klump, is that there just aren\u2019t enough homes coming to market to satisfy demand; newly-listed homes were down 6.7% month over month across the nation.<\/p>\n

\u201cThe shortage of homes available for sale has become more severe in some cities, particularly in and around Toronto and in parts of BC,\u201d he stated in CREA\u2019s release. \u201cUnless sales activity drops dramatically, the outlook for home prices remains strong in places that face a continuing supply shortage.\u201d<\/p>\n

The number of months it would take to completely deplete available housing for sale \u2013 a measure used by CREA to monitor demand \u2013 is at a six-year low, at 4.6 months. And in too-hot-too-handle markets like the Greater Toronto Area and Golden Horseshoe, it\u2019s as tight as one month or less.<\/p>\n

Still a Sellers\u2019 Market<\/h2>\n

While a slowdown in sales can indicate improving conditions for buyers, that\u2019s not the case here, according to the report \u2013 because the lack of supply surpassed sales declines, Canada remains firmly a sellers\u2019 market, with a national sales-to-new-listings ratio of 67.7%, up from 64% in January. A market with a range of 40 \u2013 60% is considered to be balanced, while any ratio below that is considered a buyers\u2019 market.\u00a0 Not surprisingly, the majority of above-60% ratios can be found in British Columbia and in Southwestern Ontario, reports CREA.<\/p>\n

These declines are month-to-month and show what could be the start of a longer-term trend. On an annual basis, sales actually rose slightly in two thirds of markets including the GTA, Calgary, Edmonton, London, St. Thomas, and Montreal.<\/p>\n

However, they are down \u201csignificantly\u201d in the Lower Mainland area of British Columbia, indicative the region is still possibly grappling with fewer foreign investors, fallout from unsustainable prices, and from new mortgage rules which could be disqualifying more first time buyers from entering the market. Despite the slowdown, though, prices had grown so aggressively in the area, that they\u2019re still well above last year\u2019s levels, up 24.9% and 15.6% in the Fraser Valley and Greater Vancouver region, respectively.<\/p>\n

New Mortgage Rules Could Be Factor<\/h2>\n

In fact, according to CREA President Cliff Iverson, these new mortgage rules<\/a>, which require those paying less than 20% down on their homes to qualify at a rate of 4.64% for their mortgage \u2013 could also play a part in the sales downturn. \u201cCanadian home buyers face some challenges this year including new mortgage rules that make it harder to qualify for a mortgage and regulatory changes that will push up mortgage financing costs,\u201d he stated. \u201cIt will take some time to gauge the extent to which these challenges will weigh on home buyers in different housing markets across Canada.\u201d<\/p>\n

Prices Driven By Toronto and Vancouver<\/h2>\n

According to CREA, the new average home price (for all markets across Canada) rose just 0.2% year over year, to $470,253. If that seems low, consider that much of the growth can be attributed to steep price increases in the GTA and Greater Vancouver markets; excluding them, the average price would be $351,998.<\/p>\n

Southern Ontario \u2013 and particularly the Golden Horseshoe market (Hamilton real estate<\/a>, Oakville-Milton, Guelph, Kitchener-Waterloo, Cambridge, Brantford and the GTA) experienced demand \u201cwithout precedent\u201d.<\/p>\n

Related Read: Hamilton Real Estate to be Hottest Market in 2017: Re\/Max<\/a><\/strong><\/p>\n

Prices surged the most for two-storey houses, at 16.8%, followed by townhouses and rowhouses at 15.8%, one-storey houses at 14.4%, and condo \/ apartments at 13.3%. Benchmark home prices rose in 10 of 13 markets.<\/p>\n

According to the report, prices also fluctuated in the following markets:<\/p>\n