Home sales increased last month for the first time this year, but average selling prices are still slightly lower than they were a year ago.
The Canadian Real Estate Association said Monday that there were 4.1 per cent more homes sold in June than there were in May. That’s the first time in 2018 that sales have increased from month to month, as the market continues to digest new mortgage “stress test” rules implemented at the start of the year.
While the pace of home selling picked up on a monthly basis, it was the slowest June for home selling in five years. There were 11 per cent fewer sales in June 2018 than there were in the same month a year earlier, and June is typically a busy month for home sales.
On the price side, there was no rebound to speak of. Nationally, the average price of a home sold in June was $496,000. That’s down 1.3 per cent from where it was a year ago, and it’s also the fifth straight month that the national market has posted yearly declines.
CREA says the average isn’t an accurate picture of the market, however, because it’s skewed by activity in some cities, and by certain types of housing. So they calculate another number — the Housing Price Indicator — which they say is a better gauge of the overall market, because it strips out all the volatility.
By that metric, house prices have increased by 0.9 per cent in the past year. The HPI has now decelerated for 14 months in a row, and is now at its lowest level since September 2009.
Prices were down in many large cities, including Toronto, Edmonton, Regina, Saskatoon and Calgary, but the pace of decline is starting to slow. And in other cities, such as Vancouver, Ottawa and Montreal, prices are increasing.
“This was a Goldilocks report,” Toronto-Dominion Bank economist Ksenia Bushmeneva said of the numbers. “Sales rose for the second month in a row with broad-based gains across the country while home prices continued to stabilize.”
After the mortgage rules changes took a major bite out of activity in the first part of the year, ” it seems that housing market is once again finding its footing,” she said.