Across Canada, home prices inched higher in December, even as sales were down year over year, CBC News reports:
Canadian home prices ticked a little bit higher in December, with the average value of a resale home rising 1.6 per cent to $352,800, according to figures released today. Prices ticked higher even after a large pullback in sales, as the number of homes sold declined by 17 per cent from last year’s level, the Canadian Real Estate Association said Tuesday.
The drop in sales is largely credited to a tightening of inventory:
One new wrinkle in the story of Canada’s housing market is a decrease in the number of listings. The supply of new homes for sale has now declined for three straight months, bringing the national number of listings to its lowest point since March 2011.
This is mirrored in the Vancouver market, The Globe and Mail reports, where prices have softened since May due to a lack of inventory/sales:
Prices have softened in Vancouver, with the MLS Home Price Index benchmark price sliding 5.8 per cent, to $590,800, since reaching a peak of $625,100 in May. That’s the impact so far of the steep drop in sales that began in this city earlier than in the rest of the country, and has continued right through December. It’s a sharp reversal for a city whose market was flying high in 2011, which set a record for sales with 30,595 homes changing hands over the MLS.
The Globe and Mail also reports that Toronto home sales were down year over year in December, while prices increased:
21.8% – Decline in Toronto’s home sales in December from a year ago. The growth in Toronto’s home prices has been slowing. The average selling price in December was up by 6.5 per cent from a year ago, to $478,739. The average selling price for the whole year was up by almost 7 per cent to $497,298.
Condo sales are leading the sales decline in Toronto:
Sales of condos have now fallen by much more than detached homes. Sales of condos in the downtown area covered by the 416 area code fell 26.9 per cent in December from a year ago, while detached home sales in the same area fell 12.3 per cent.
Over in Quebec, The Montreal Gazette says that tighter mortgage rules are keeping first-time buyers out of the market:
Experienced buyers are expected to dominate a softer Canadian resale market in the coming months, a trend that could hit sales in Quebec which has the highest proportion of first-time buyers in the country. Forty per cent of buyers were purchasing a home for the first time in Quebec, compared to 30 per cent nationally, a RE/MAX survey published today said. Tighter mortgage rules introduced last summer have led to plummeting home sales in Greater Montreal on lower-end properties which attract first time buyers, real estate board statistics show.
In Winnipeg, 2012 home sales were down slightly in volume but up in dollars over 2011, CBC says:
Winnipeg home sales hit a record mark in 2012, reaching $3.2 billion in dollar volume. According to the Winnipeg Realtors Association, it is only the second time ever that sales exceeded the $3-billion mark — first reached in 2011. Although sales slipped by one per cent in 2012 compared to 2011 (13,007 versus 13,065), the dollar volume increased by five per cent ($3.20 billion versus $3.06 billion).
In Calgary, Rocky View Weekly reports that the suburbs are experiencing much higher real estate sales growth than Calgary itself:
Home sales growth in the towns and cities surrounding Calgary far outpaced the growth in the city of Calgary last year, ending the year up 21 per cent. Airdrie, Okotoks and Cochrane all recorded double-digit sales growth in the fourth quarter, according to a statement released by the Calgary Real Estate Board (CREB(R)).
The prognosis for 2013? The Business Review Canada predicts a stagnant first half of the year, followed by slow growth for the remainder of 2013:
In the Q4 of 2012, Canadian real estate saw the average price of a home increase 2 to 4 per cent in comparison to 2011. Due to this increase, home sales in Canada are expected to become stagnant in the first half of 2013, thus affecting the growth of home prices nationally. Royal Le Page estimates that by the end of 2013, home prices will have increased just slightly, up 1 per cent.
Better than a crash!