Canada

Canadian Real Estate Sales Rise 5%, Falling From Peak 2019 Growth

Canadian real estate sales were busier than last year, but fell from peak 2019 growth. Canadian Real Estate Association (CREA) numbers show a large climb in sales for August. Falling mortgage rates, and anticipation of policy drive market growth were behind some of the country’s largest rises.

Canadian Real Estate Sales Rise Over 5%

Canadian real estate sales weren’t quite back to the highs seen a few years ago, but volumes are rising. There were 43,478 unadjusted sales process through CREA, down 9.0% from the month before. This represents a 5.7% increase compared to the same month last year. The monthly decline is seasonal, but it was larger than expected.

Canadian Real Estate Sales

The unadjusted sales for all home types, as reported through the Canadian MLS.

Source: CREA, Better Dwelling.

Sales made an unusually large seasonal drop, but were still up on the year. The 9.0% monthly decline seen last month, is 50% larger than the 10-year median for August. The market managed to squeeze out a 12 month increase. However, this follows two years of declines for August sales. The annual pace of growth also fell from peak growth for 2019, reached last month. Growth hasn’t moved long enough in any direction this year to give a clear picture of which way it’s heading.

Canadian Real Estate Sales Change

The annual percent chage of unadjusted sales for all home types, as reported through the Canadian MLS.

Source: CREA, Better Dwelling.

Winnipeg, Vancouver, and Quebec Real Estate Lead In Growth

The fastest growing real estate markets are Winnipeg, Vancouver, and Quebec City. Winnipeg reported 1,161 sales in August, up 16.1% from the same month last year. Vancouver followed with 1,961 sales, up 15.0% from last year. Quebec City was the third fastest with 453 sales, up 13.5% from last year. Winnipeg and Quebec follow two consecutive years of growth, but are small markets. Vancouver is seeing a big jump, but that follows August 2018’s unusually slow sales.

Canadian Real Estate Sales By Market

Canadian real estate sales in markets with more than 400 sales in 2018.

Source: CREA, Better Dwelling.

Kitchener, Edmonton, and Saskatoon Real Estate Lead Lower

The fastest shrinking markets are Kitchener, Edmonton, and Saskatoon. Kitchener made the biggest drop, with just 510 sales in August, down 13.5% from last year. Edmonton follows with 1,894 sales, down 4.4% from the month before. Saskatoon has the third biggest drop with 436 sales, down 4.1% from last year. Western Canada and big city suburbs seem to be where slowing sales are concentrated.

Canadian Real Estate Sales Change By Market

The percent change in Canadian real estate sales, in markets with more than 400 sales in 2018.

Source: CREA, Better Dwelling.

Canadian real estate sales made a big climb, just not quite as big as the month before. Sales normally slow towards the end of the summer, but they’ve picked up this year. Falling mortgage rates and policy-based stimulus are believed to be behind the boost.

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11 Comments

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  • Marc 1 month ago

    [sad trombone]

    That growth is looking a little flacid.

    • Mortgage Guy 1 month ago

      There’s a reason all of the government executives with terms related to housing had their terms extended until just after the election. I’ll let you decide why they would do that.

      • sophia 1 month ago

        Will something happen after the election?

        • Ethan Wu 1 month ago

          I believe he’s referencing the term changeover for the CMHC and the BOC. Both received quietly received an unusual two-year extensions to their terms, that end a few months after the election.

          It’s unclear who’s coming in next, and what the impact will be, but it may not necessarily be the same direction as its been, which could lead to volatility.

  • Party on 1 month ago

    The latest credit market summary data table from Statistics Canada (to the end of June, 2019):

    https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3810023401

    • Mortgage Guy 1 month ago

      Why do real estate agents link to technical things that don’t prove their point, and pretend it does?

      The 3.7% growth, factor inflation and interest and the delta is still underperforming lender credit needs. That’s before you factor in that CMBs required a non-competitive liquidity injection to for rate supression ahead of the election.

      I actually think sales will rise since the level is so low based solely on the fact that an election will pander to the real estate industry with stimulus, but this isn’t even close to your point.

      It also makes the real estate industry seem less trustworthy, and frankly, kind of dumb.

      • Jin 1 month ago

        lol. I find this a lot with Canadian real estate agents in Hong Kong. They’ll link to something on WeChat totally unrelated to their point.

        I can’t tell if they don’t understand it, or if they’re trying to “blitz” in consulting terms. Either way, it’s a bad look for professionals.

  • Pete 1 month ago

    Sales will rise until the end of the election season. The catch is renters are mostly in major cities, that already have their biases in who they’ll vote for. Governments will pander for suburban owners at the expense of urban ones, since they know they can’t change urban owners minds.

  • Jupiter 1 month ago

    Guys no amount of bitching going to do anything. Time to act, tell the government to put in a predatory real estate tax that force hoarders to sell their none primary residential units.

    Time to protest.

  • DB 1 month ago

    good for Canada if sales rise, but prices are still dropping unless you live on the lakeshore with a beautiful view and 3500 + house and nice size lot close to T.O. in other words, location, location, location…

  • Bumblebee 1 month ago

    Canada economy = Real estate Ponzi scheme bubble.
    If we check data, we will find that home prices doubled mainly from 2015 to 2019.
    Liberals stimulated the economy by creating a Fake economy that is now ruining us…
    We are becoming poor, no retirement like Europeans, seniors need to take reverse mortgage loans to survive.
    People in Toronto are spending more that 50% of their salaries in rent… $2700 per month for a bachelor…
    Auto and retail sales are dropping….
    Fertility rates are dropping as less can afford to have children…
    Depression and metal issues are rising…
    Life in Canada is no longer enjoyable… Hope conservatives will be elected to save us from this hell.

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