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The monthly gains show that demand is once again outstripping supply, says CREA
Released May 15, 2023 • Last update 5 hours ago • 3 minutes reading time
Canada’s housing market revived in April with sales up more than 11 percent month-on-month. Photo by Matthew Sherwood for National Post
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The average price of a home sold in Canada rose 4.3 percent in April and is now up nearly 17 percent since January as the country’s housing market continues to show signs of recovery, according to figures from the Canadian Real Estate Association.
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April housing data released on May 15 showed that the monthly increase from the previous month lifted the unadjusted median price to $716,000, more than $100,000 more than in January but still 3.9 percent below the level at the end of the month April 2022. The MLS price index is also up a more modest five percent from January.
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Meanwhile, sales this month rose 11.3 percent while new listings rose just 1.6 percent, taking new listings to their lowest level in 20 years, CREA’s report said.
CREA chairman Larry Cerqua said it means demand is once again outstripping supply.
“There have been signs in recent months that property markets would bounce back this year, so it came as no surprise that things picked up speed after the Easter weekend, which often serves as a prelude to the spring market,” Cerqua said in a press release.
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In an interview, CREA Senior Economist Shaun Cathcart said sales had recovered since January has been This is the case in many markets in Canada, but disproportionately so in Toronto and Vancouver.
“I think it’s going to carry over from that average composition growth to actual individual home prices, which are rising now as more buyers re-enter the market, which is still very underserved.” he said.
As sales gains far outpaced new listings in April, the sales-to-new listings ratio jumped to 70.2 percent from 64.1 percent in March, according to CREA.
Cathcart said the supply problem and strong demand means Canada is still a seller’s market.
“I wasn’t surprised in April that prices not only stabilized but started to rise again. But I don’t think they will increase as much as during the COVID-19 period,” he said Cathcart.
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With prices soaring, the Canadian housing market may have hit a “price bottom” or bottom in early January, Elton Ash, vice president of Re/Max Canada, said in an interview.
Ash said the market appears to be returning to its “historic norm” in terms of interest rate levels.
“We knew something like this was going to happen because we saw inventories drop over the last year and we knew buyers would get used to higher interest rates because they weren’t record high,” he said. “So basically this is just a continuation of Canadian confidence in home ownership and the desire to live in our own homes.”
In a separate report, Desjardins economist Hélène Bégin said the latest figures showed the seller’s market had become even more pronounced.
Bégin pointed out that high interest rates and construction costs are making financing difficult for some developers and builders, as pre-sales of new homes are declining.
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FOMO returns to the Canadian real estate market
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It looks like Canada’s real estate market has finally turned the corner
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Toronto home prices rise for the third straight month
“This rebound in the housing market is not good news for the Bank of Canada,” she wrote in the report. “The restrictive impact of past rate hikes isn’t preventing the real estate market from recovering well.”
• Email: [email protected] | Twitter: denisepglnwn
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