Canada’s real estate markets experienced a decline in homes listed and sold in April 2020 when compared to the previous month, according to the latest market report from the Canadian Real Estate Association (CREA).
April 2020: Canada’s Real Estate at a Glance
Between March and April, residential real estate sales in Canada fell by 56.8% as pandemic-fuelled physical distancing measures and economic fallout continued, prompting homebuyers and sellers to put their moving plans on hold.
Month-over-month home sales fell is all of Canada’s biggest housing markets, including the Greater Toronto Area (-66.2%), Montreal (-64.4%), Greater Vancouver (-57.9%), the Fraser Valley (-54.8%), Calgary (-53.1%), Edmonton (-46.6%), Winnipeg (-42%), Hamilton-Burlington (-59.8%) and Ottawa (-51.5%).
The decline in sales is in lockstep with a national drop of 55.7% in new listings hitting the market between March and April.
On a year-over-year basis, transactions were down 57.6% in April 2020 compared to April 2019. This is the lowest April sales figure since 1984.
“Never in our recent history have we dealt with such widespread effects of a pandemic that limit everyone’s day-to-day life, and have forced all of us to pivot and adjust to our new reality,” said Costa Poulopoulos, Chair of CREA.
“Like so many other parts of normal daily life, a lot of buying and selling activity in housing markets across Canada has been put on pause,” said Shaun Cathcart, CREA’s Senior Economist. “That said, preliminary data for May suggest things may have already started to pick up a bit for both sales and new listings, in line with evidence that new and existing virtual technology tools have been adopted by Realtors and their clients.”
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“We’ve seen a massive uptick in the use of technology to facilitate virtual deals over the past few weeks,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Given that people may still need to proceed with buying and selling for a host of different reasons, this makes it possible and safe – and agents have the tools.”
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New Listings & Inventory
Canada’s real estate markets saw new listings fall by 55.7% month-over-month in April.
Home sales and new listings saw a similar decline in April, leaving the national sales-to-new listings ratio at 62.4% compared to 64% in March and 65.4% in February. “While this is down slightly, the bigger picture is that this measure of market balance has been remarkably little changed considering the extent to which current economic and social conditions are impacting both buyers and sellers,” CREA says.
April had 9.2 months of inventory, up from March’s 4.3 months and well above the long-term average of 5.2 months.
Canada’s Housing Prices
Canada’s real estate prices in April 2020 declined by 1.3% year-over-year, at $488,000.
This number is skewed by the Greater Vancouver Area and the Greater Toronto Area, which are Canada’s busiest and priciest housing markets. Excluding these two markets would reduce the national average house price by almost $100,000, to $392,000.
Canada’s real estate markets saw considerably fewer homes listed and sold in March 2020 when compared to the previous month, according to the latest market report from the Canadian Real Estate Association (CREA).
March 2020: Canada Real Estate at a Glance
Between February and March, residential real estate sales in Canada fell by 14.3% as pandemic-fuelled physical distancing measures and economic fallout prompted both buyers and sellers push “pause” in second half of the month.
Month-over-month home sales fell is all of Canada’s biggest housing markets, including the Greater Toronto Area (-20.8%), Montreal (-13.3%), Greater Vancouver (-2.9%), The Fraser Valley (-13.6%), Calgary (-26.3%), Edmonton (-13.2%), Winnipeg (-7.3%), Hamilton-Burlington (-24.9%) and Ottawa (-7.9%).
On a year-over-year basis, transactions were up 7.8% in March 2020, compared to March 2019. However, CREA notes that despite the increase, this is still a considerable slowdown compared to the 30% gain recorded in February.
“March 2020 will be remembered around the planet for a long time. Canadian home sales and listings were increasing heading into what was expected to be a busy spring for Canadian Realtors,” said Jason Stephen, president of CREA. “After Friday [March] 13, everything went sideways.”
Realtors have been following social-distancing measures as advised by government and public health agencies, assisting those who are already in the market view homes and complete their transactions virtually.
Shaun Cathcart, CREA’s Senior Economist notes that March 2020 was a tale of two markets, “with most of the stronger sales and price growth recorded during the pre-COVID-19 reality which we are no longer in,” he said. “The numbers that matter most for understanding what follows are those from mid-March on, and things didn’t really start to ratchet down until week four. Preliminary data from the first week of April suggest both sales and new listings were only about half of what would be normal for that time of year.”
New Listings & Inventory
New real estate listings hitting the market were down month-over-month in March (-12.5%). Similar to sales activity, the decline in listings was experienced in virtually all markets across Canada.
With sales and new listings both seeing similar declines in March, the national sales-to-new listings ratio declined to 64% compared to 65.4% in February. Despite this slight recession, CREA notes, “market balance was remarkably little changed considering the extent to which current economic and social conditions are impacting both buyers and sellers.”
Based on the sales-to-new listings ratio and the long-term average, two-thirds of local markets were balanced, with most of the remaining markets landing in seller’s territory.
CREA reports 4.3 months of inventory at the end of March 2020, up from February’s 15-year low of 3.8 months however almost a full month below the long-term average of 5.2 months.
Canada’s real estate prices in March 2020 were defined by tight market conditions and a strong start to the month, before physical distancing measures took effect. The national average price was just over $540,000, up 12.5% year-over-year.
CREA notes this number is skewed by the Greater Vancouver Area and the Greater Toronto Area, which are Canada’s busiest and priciest housing markets. Excluding these two markets would reduce the national average house price by more than $130,000, to around $410,000.