MLS® home sales ease in January

The number of properties sold via the MLS® systems of real estate boards in Canada slipped further in January 2009, according to statistics released by The Canadian Real Estate Association (CREA). Seasonally adjusted residential MLS® sales activity numbered 26,376 units in January 2009. This is 3.1 per cent below activity in December 2008, and a decline of 37.3 per cent in activity compared to January 2008. Monthly percentage declines in seasonally adjusted activity in January 2009 were on par with those in December 2008 (-2.4 per cent month-over-month), and moderate by comparison to October (-14.9 per cent) and November 2008 (-11.8 per cent). Monthly declines in seasonally adjusted sales activity in British Columbia and Ontario pulled national activity statistics lower, and offset monthly increases in MLS® residential sales activity in Manitoba, and Newfoundland & Labrador. Actual MLS® resale housing activity totaled 16,343 sales nationally in January 2009, down 40.9 per cent on a year-over-year basis. Only Prince Edward Island recorded an increase in residential units sold, up two per cent compared to January 2008. The supply of homes for sale remains high, but is trending lower nationally. The decline in new MLS® listings is trending lower in line with sales activity in many regions. Seasonally adjusted new MLS® residential listings numbered 69,875 units in January 2009. This is down three per cent from the previous month, and 13 per cent below the peak reached in May of last year. The actual (unadjusted) number of new listings on the MLS® systems of real estate boards in Canada posted the largest year-over-year decline on record in January 2009, falling 14.2 per cent from the level in January 2008. The decline in supply to meet lower demand is expected to help stabilize the resale housing market balance and put a floor under prices. “There is no doubt the market is not as active as it was last year, but there are certainly buyers and sellers in the Canadian residential market,” says the President of the Canadian Real Estate Association, Calvin Lindberg of Vancouver. “In many markets, transactions have a tendency to take longer because of negotiations between the two. Realistic pricing is the key to the sale of residential property in this market. Conditions also vary from one neighbourhood to another, so buyers and sellers should know those details.” CREA’s President is also confident federal budget initiatives for homebuyers will have an impact later in the year. “The increase in the Home Buyers’ Plan and the First-Time Home Buyers’ Tax Credit to cover closing costs are both important for first time home buyers, and they are an important factor in an active housing market.” The national average price for home sales via the MLS® in January 2009 is down 11.3 per cent compared to January 2008. This national average price continues to be skewed lower in large part by fewer sales in British Columbia, Alberta and Ontario, where homes are more expensive and demand has softened most. The MLS® average home sale price was up from year-ago levels in Saskatchewan, Manitoba, Prince Edward Island, and Newfoundland & Labrador. The price trend is similar but less dramatic for the weighted national (and major market) MLS® average price, which compensates for changes in provincial (and major market) sales activity by taking into account provincial (and major market) proportions of privately owned housing stock. The weighted national MLS® average sale price was down 6.2 per cent year-over-year in January. The weighted major market MLS® average home sale price was down 4.6 per cent year-over-year in January. The major market MLS® residential average price declined by less than the national average on a year-over-year basis. Major markets in which the average price declined by less than the national average include Toronto, Kitchener-Waterloo, St. Catharines, Sudbury, Hamilton-Burlington, Edmonton, London & St. Thomas, and Windsor. By contrast to year over year declines in the national and major market average price in January 2009, average prices were up from year ago levels in St. John’s, Halifax-Dartmouth, Quebec City, Regina, Saskatoon, Saguenay, Oshawa, Winnipeg, Thunder Bay, Montreal, Ottawa, and Gatineau. Seasonally adjusted residential dollar volume for MLS® sales totaled $7.4 billion in January 2009, down 3.7 per cent from the previous month and the lowest level since May 2003. “Weak sales activity in January follows the CREA forecast that national MLS® sales activity will be well below the activity of last year,” says CREA Chief Economist Gregory Klump. “Affordability has improved and will be better during the spring home buying season in many markets compared to last year. However weak consumer confidence is likely to continue squeezing sales activity during the spring home buying season.” PLEASE NOTE: The information contained in this news release combines both major market and national MLS® sales information from the previous month. The Canadian Real Estate Association has previously released these separately. CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighborhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types. MLS® is a co-operative marketing system used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale. The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 98,000 REALTORS® working through more than 100 real estate Boards and Associations. Further information can be found at www.crea.ca. The full news release is available in PDF format here. (CREA 13/02/09)