National sales activity dropped 3.3% in January from December 2013 New listings were flat in January up two tenths of a percent nationally from the month before. Average prices continued rising in January up 9.5% from a year ago. Hi. Gregory Klump here, Chief Economist
for the Canadian Real Estate Association, with a quick highlight on national housing activity over MLS® Systems of Canadian Real Estate Boads and Associations for January 2014. It likely comes as no surprise to viewers in Southern Ontario that the Polar Vortex
chilled sales activity there. That in turn put a dent in the national sales, which dropped almost 3 and 3/10ths of a % compared to December 2013.
Housing starts and resale activity were both down in January thanks to those unusually
frigid temperatures, making Canada’s housing market performance in January 2014 something of a weather report of sorts. That said, the Polar Vortex was not factor
influencing home sales in places that enjoyed non-cryogenic temperatures, making the weather an apt metaphor for how all real estate is local. In any event, January marked the fifth straight monthly decline in national activity, leaving
sales 9% below their peak reached in August. As for price:
Average prices in January were up from year-ago levels in more than double the number of places where they were down, including almost all of Canada’s most active housing markets.
Finance Minister Flaherty of course continues to keep an eye on home prices for signs that
the housing market is overheating as interest rates remain low for longer.
That said: His 2014 Federal Budget indicated that the Canadian housing market overall is
evolving constructively, and recognized that prices in Toronto & Vancouver are being fueled by land scarcity for single family homes — which is to say fundamentals and not speculation
are what’s driving prices there. So while Finance Minister Flaherty is — to
quote directly from the Budget, “…willing to take further action should the situation
warrant…” unquote, the Budget made it clear that the doomsday clock for yet more tightening of mortgage regulations has been set back. There’s a lot more to say about the housing market in Canada, so if you want to know more, please visit crea.ca and talk to your local REALTOR® about what’s going in the market
where you live or where you might like to. I’ll be back soon with more news about home
sales activity over MLS Systems of Canadian Real Estate Boards, so stay tuned.