MLS® home sales remain strong in August

MLS® resale housing activity in Canada’s major markets edged back from record levels but remained strong in August 2007, according to statistics released by The Canadian Real Estate Association (CREA).

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.

The month-over-month decline in seasonally adjusted sales in August also reflected a return to more normal activity levels from the record levels seen in recent months. August 2007 marked the eighth highest monthly MLS® sales level on record for seasonally adjusted activity in Canada’s major markets. Seasonally adjusted transactions posted the third highest monthly level on record in Saint John NB and St. John’s NF, and reached the fourth highest level ever in Ottawa.

Actual (unadjusted) MLS® sales activity in August was up 6.1 per cent compared to the same month last year. This continues the trend where transactions have posted year-over-year gains in every month so far in 2007. The year-to-date MLS® sales total including August numbered 265,833 units, an increase of 9.8 per cent from levels recorded in the first eight months of last year. Year-to-date transactions continue to run ahead of year-ago levels in almost all major markets.

“There were adjustments to mortgage rates in July that may have had an impact on the re-sale housing market in August” says 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.”

The seasonally adjusted totals for MLS® residential new listings (48,817 units) edged 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 re-sale housing listings in Calgary, Winnipeg and Saskatoon.

That 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 compared to July. High numbers of new listings have caused market conditions in Calgary, Edmonton, Saskatoon and Regina to become more balanced since the beginning of the year, when these were four of the tightest housing markets in Canada. While Winnipeg remains the tightest of Canada’s major markets, it also became more balanced in August. In contrast, market conditions in Vancouver and Kitchener-Waterloo were tighter in August than in any other month this year.

“The move to a more balanced market means some buyers will take more time to shop,” says CREA President and REALTOR® 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.” Research published by The Canadian Real Estate Association shows each MLS® residential housing sale generates an additional $32,200 in consumer spending.

“With a higher supply and continued strong demand, we anticipate the re-sale housing market will remain strong and steady for the balance of the year" the CREA President adds. “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. (CREA 14/09/07)