According to statistics released today by The Canadian Real Estate Association (CREA), national resale housing activity improved in February 2012 after having declined in January.
Sales activity recorded through the MLS® Systems of Canadian real estate Boards and Associations edged up 1.4 per cent from January to February 2012, recouping one-third of the monthly decline in activity between December 2011 and January 2012.
Activity was up on a month-over-month basis in half of all local markets in February, led by Calgary, Toronto, Barrie, Montreal, Quebec City, Saint John, and Halifax-Dartmouth.
Actual (not seasonally adjusted) activity was up 8.6 per cent on a year-over-year basis in February. A total of 61,772 homes traded hands in the first two months of 2012, up 6.7 per cent from the same period in 2011.
The number of newly listed homes also rebounded 1.9 per cent on a month-over-month basis in February, reaching the highest level since May 2010. A rebound in new listings in Toronto and Montreal, Canada’s two most active markets, offset a retreat in new listings in Vancouver, Canada’s third largest market.
With both sales and new listings having risen, the national sales-to-new listings ratio, a measure of market balance, was little changed in February (53.3 per cent) compared to January (53.6 per cent) and remains firmly in balanced market territory.
“The national rise in both sales activity and the number of newly listed homes beyond the normal seasonal increase provides clear evidence that Canadians are confident in housing market prospects,” said Gary Morse, CREA’s President. “Confidence varies by region, as do prospects for housing demand. For that reason, buyers and sellers should talk to their local REALTOR® to understand current and prospective trends in their local housing market.”
“It is important to remember that MLS® home sales and purchases are a significant source of economic activity and job creation. Total consumer spin-off spending resulting from MLS® home sales and purchases will add an estimated $19.4B to the economy, and create over 159,000 jobs in 2012,” continued Morse.
Based on a sales-to-new listings ratio of between 40 to 60 per cent, 60 per cent of local markets were balanced in February. Compared to the previous month, there were more buyers’ markets and fewer sellers’ markets.
The number of months of inventory stood at 5.9 months at the end of February on a national basis, unchanged from levels reported in January. The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand.
The actual (not seasonally adjusted) national average price for homes sold in February 2012 was $372,763, up two per cent from its reading for the same month last year.
“In February 2011, the national average price was stretched upward by a spike in high-end home sales in some of Vancouver’s priciest neighbourhoods, and a replay of that was not expected this year,” said Gregory Klump, CREA’s Chief Economist. “February’s data bear this out, but other factors are now keeping the national average price aloft. The main one is the housing market in Toronto, where a tight balance between supply and demand continues to drive some of the strongest home price gains in the country, particularly for single detached properties.”
There has been a preference in recent months, in Toronto and other markets, for single family homes which are typically more expensive. This trend held in February, putting additional upward pressure on the national average home price.