MLS® home sales break more records in July

MLS® resale housing activity in Canada’s major markets set a fourth consecutive monthly record in July 2007, according to statistics released by The Canadian Real Estate Association (CREA).

Seasonally adjusted sales activity totaled 31,667 units in July 2007 – an increase of 0.8 per cent from the previous month. The monthly increase was fueled by higher activity in Vancouver, Toronto, and London and St. Thomas. Seasonally adjusted sales activity also set new monthly records in Toronto, London and St. Thomas, and Hamilton-Burlington, and reached the second highest monthly level ever in Ottawa and Montréal.

Year-to-date transactions also set new records in almost all major markets in July. MLS® home sales via Board and Association MLS® systems numbered 235,980 units in Canada’s major markets during the first seven months of 2007, up 10.3 per cent from the same period in 2006.

New listings edged down slightly in July 2007 from the record set in June, but still reached the second highest monthly level on record. Seasonally adjusted MLS® residential new listings numbered 49,726 units in July, down 1.4 per cent from the previous month. The small monthly decline was caused by fewer listings in Calgary and Edmonton, although new listings in these markets remain near record levels.

The resale housing market tightened in July compared to the previous month due to fewer listings and higher sales activity. The market remains tightest in Winnipeg and Regina.

The major market MLS® residential average price rose 13.1 per cent year-over-year to $332,442 in July. This represents the largest year-over-year growth in average price since April 2004. Average price reached the highest monthly level on record in Calgary, Regina, Québec City, and St. John’s.

“Home buyers with pre-approved mortgages decided to get into the market after the Bank rate was increased in July, pushing MLS® home sales in Canada’s major markets to record levels,” said CREA Chief Economist Gregory Klump.

“As this report shows, Canada's resale housing market has shrugged off the subprime problems that have been affecting the housing market in the United States, and a number of investment funds," said Ann Bosley, President of The Canadian Real Estate Association. "Canadian lenders have launched some alternative mortgage options in the past year, but they appear to be more conservative and are unlikely to overdo any subprime lending, which has been the problem affecting the U.S. housing and borrowing markets."

The resale housing market in many cities is more balanced than earlier in the year, the CREA President notes, and overall fundamentals are still a positive influence.

"Canada's economy is strong, and the employment statistics released last week were very strong,” added Bosley. “Canadian lenders and consumers are learning from the U.S. experience, and it has not had any major impact on consumer confidence in the housing market.” (CREA 15/08/07)