Resales of Canadian Homes up 18 Percent in Third Quarter

The Canadian Real Estate Association says sales of existing homes during the third quarter were among the strongest on record.  National home resales through the Multiple Listing Service owned by Canada’s realtors totalled 135,182 in the third quarter of 2009, up 18 per cent from a year earlier and the most of any third quarter on record.

It was also the biggest year-over-year gain since early 2002 – another sign that the Canadian housing market is quickly returning to health. The seasonally adjusted number was 127,941 homes resold, up 12 per cent from the second quarter and 48 per cent higher than the fourth quarter of 2008.

Association president Dale Ripplinger attributed the strong quarter to low interest rates and improved consumer confidence, which bought more buyers into the market.

In September, 42,958 homes were sold through the MLS. The average price last month climbed 13.6 per cent from September 2008 to $331,602.

“Headline average price increases over the rest of the year are expected to prompt sellers to return to the market after having retreated to the sidelines late last year and earlier this year,” said CREA chief economist Gregory Klump.

“An increase in new listings will help keep a lid on price increases. Price increases over the rest of 2009 and early next year are likely to reflect declining average prices late last year and earlier this year.”

Klump added that national sales activity seems to be “starting to plateau.”

The supply of homes coming onto the MLS market edged up by a seasonally adjusted one per cent quarter-over-quarter, the first increase after four consecutive quarterly declines. However, CREA said new listings are likely to remain down compared to a year earlier for “some time.”

Inventories of homes for resale was down 16 per cent at the end of September compared to a year earlier due to an increase in sales activity and fewer new listings, CREA said.

The numbers compiled by CREA from transactions using the Multiple Listing Service don’t include sales handled by non-member agents.

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