Canadian home sales saw an “unexpected surge” in December as sellers and buyers came together to get deals done before the new year, according to the national real estate body.
The Canadian Real Estate Association (CREA) said Monday that December saw an 8.7 per cent jump from November in the number of homes sold. That put the final month of the year on par with some of the “relatively stronger” spring and summer months, CREA said.
CREA senior economist Shaun Cathcart said in a statement that it’s unlikely the surprisingly strong December was a sign of a housing market rebound kicking off.
“It was more likely just some of the sellers and buyers that were holding onto unrealistic pricing expectations last fall finally coming together to get deals done before the end of the year,” he said.
“We’re still forecasting a recovery in housing demand in 2024, but we’ll have to wait a few more months to get a sense of what that ultimately looks like.”
There were few people listing their homes in the traditionally slow December, pushing the sales-to-new listings ratio back up to 57.8 per cent from just over 50 per cent in November. This key metric helps to gauge whether markets favour buyers or sellers, with CREA putting the long-term average of around 55 per cent.
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The volume of home sales were up 3.7 per cent year-over-year in December.
Looking back at the whole year, CREA said there was a total of 443,511 home sales in 2023, down 11.1 per cent from the year earlier when the Bank of Canada’s interest rate tightening cycle — and by extension, the housing correction — began.
CREA said 2023 was the lowest annual level for national sales since 2008. Last year was nearly on par with the five years following the financial crisis of that year, and the first year of the mortgage stress test in Canada in 2018.
On a non-seasonally adjusted basis, the national average home price hit $657,145 to close the year, up 5.1 per cent from December 2022.
CREA noted that ongoing price declines are mainly concentrated in Ontario’s Greater Golden Horseshoe region as well as some markets in British Columbia. Elsewhere, prices are holding firm or climbing in some provinces including Alberta, New Brunswick and Newfoundland and Labrador.
More to come.
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