MLS® resale housing activity in Canada’s major markets declined from previous record levels but remained strong in August, according to the Canadian Real Estate Association.
“There were adjustments to mortgage rates in July that may have had an impact on the resale housing market in August,” said CREA chief economist Gregory Klump, “but the housing market continued at near-record levels because the Canadian economy is strong, and two factors that influence housing — employment and consumer confidence — are strong.”
Seasonally-adjusted national MLS® sales activity totaled 29,717 units in August 2007, down 5.3 per cent from July when monthly sales hit the second highest level on record. While MLS® sales edged lower in many major markets, the national monthly decline was largely the result of fewer sales in August in Toronto, Montreal, Edmonton and Vancouver.
But in Winnipeg, MLS® activity remained on a record pace with sales in August topping the $200 million mark for the first time in the WinnipegREALTORS® Association’s 104-year history.
The CREA said the national month-over-month decline in seasonally-adjusted sales in August reflected a return to more normal activity levels from the record levels seen in recent months. August marked the eighth highest monthly MLS® sales level on record in Canada’s major markets.
Unadjusted MLS® sales activity in August was up 6.1 per cent compared to the same month last year, a continuing trend of transactions posting year-over-year gains every month so far in 2007.
The year-to-date MLS® sales total hit 265,833 units, an increase of 9.8 per cent from levels recorded in the first eight months last year. Year-to-date transactions continue to run ahead of year-ago levels in almost all major markets.
The seasonally-adjusted totals for MLS® residential new listings (48,817 units) were down slightly in August from levels recorded in July, but still represented the sixth highest monthly level on record for new listings. The 1.5 per cent decline in new listings compared to July was the result of fewer new listings in Toronto and Vancouver, which offset the increase in resale house listings in Calgary, Winnipeg and Saskatoon.
The combination of a decline in MLS® sales and a slight drop in new MLS® listings in August meant the resale housing market was more balanced when compared to July.
While Winnipeg had the lowest percentage of available listings in Canada’s major markets, it also became more balanced in August, according to CREA.
Wes Schollenberg, president of WinnipegREALTORS®, said 60 per cent of all active MLS® listings sold in August.
“The move to a more balanced market (across Canada) means some buyers will take more time to shop,” said CREA president Ann Bosley.
“Canada’s housing market continues to show resiliency to the sub-prime controversy in the United States, and continues to be a major positive factor in the Canadian economy,” she noted.
Research published by CREA shows that each MLS® residential housing sale generates an additional $32,200 in consumer spending.
“With a higher supply and continued strong demand, we anticipate the resale housing market will remain strong and steady for the balance of the year" the CREA president said. “This is a housing market built on good fundamentals, including good lending practices.”
The major market MLS® residential average price rose 11.2 per cent year-over-year to $325,881 in August. Average price reached the highest level on record in Saskatoon, Sudbury, Windsor and St. John’s, and remained above levels recorded in August 2006 in all major markets.