Sales down, starts up as new decade begins
February 21, 2020
Sales of existing homes were down but starts of new homes increased in
January 2020 compared to the last month of the previous decade.
Home sales recorded through the multiple listing service declined by 2.9 per cent in January, although they remain among the stronger monthly readings of the last few years according to the Canadian Real Estate Association (CREA).
Transactions were down in a little over half of all local markets in January, with the national result most impacted by a slowdown of more than 18 per cent in the Lower Mainland of British Columbia.
Actual (not seasonally adjusted) sales activity was up 11.5 per cent compared to January 2019, marking the best sales figures for the month in 12 years.
"Home price growth continues to pick up in housing markets where listings are in short supply, particularly in Southern, Central and Eastern Ontario," said Jason Stephen, president of CREA. Prices declined slightly across the Prairies and in Newfoundland and Labrador, which have a substantial inventory of existing homes for sale.
Nationally, there was 4.2 months of inventory at the end of January—the same as in November and December and the lowest level since the summer of 2007, CREA noted.
Some of that low inventory could be balanced by rising new home starts.
The standalone monthly seasonally adjusted rate of housing starts for all areas in Canada was 213,224 units in January, an increase of 8.8 per cent from December 2019, according to Canada Mortgage and Housing Corp. (CMHC).
Urban starts increased by 9.8 per cent in January to 202,407 units. Multiple urban starts increased by 13.6 per cent to 155,140 units in January while single-detached urban starts decreased by 0.9 per cent to 47,267 units.
Rural starts were estimated at a seasonally adjusted annual rate of 10,817 units in January, CMHC reports.