Canadian home sales soared to yet another record in March, as increased housing supply slowly made a return to the overheating market.
According to the latest report published by the Canadian Real Estate Association (CREA), home sales across the country set a new all-time record in March, rising by 5.2% from the month prior. In the meantime, actual sales activity compared to year-ago levels increased by 76.2%; however, last year’s comparisons will likely be significantly stretched due to the initial Covid-19 lockdown period in 2020. Nonetheless, the 76,259 properties that traded hands last month marked the highest level of activity of any month in CREA’s history, and are almost 14,000 units higher than the previous record set in July 2020.
A large reason behind the increase in sales was a rebound in listings. The number of newly listed homes jumped by 7.5%, setting a new record in March. When combined with the significant rebound in February, new housing supply has risen by more than 25% in the past two months. With new supply now outpacing the recent increases in sales, the sales-to-listings ratio has fallen back to 80.5%, from its peak level of 90.9% at the beginning of the year.
The strong demand for housing has also lead to significant price increases across the country. The MLS Home Price Index climbed by 3.1% in March from the prior month— slightly shy of the previous record gain set in February. However, compared to year-ago levels, housing prices rose by 20.1%, marking the sharpest increase on records dating back to 2005. Similarly, the average home price in March surged to a record $716,828, up by 31.6% from March 2020.
Information for this briefing was found via CREA. Thee author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.