2013 Clouds gather over Canadian housing market

April 15, 2013

The flicker of optimism that sparked in Canada’s housing market when January sales outpaced December’s has died out, erased by a notable drop in February.

Last month’s declines were significant enough to prompt the Canadian Real Estate Association (CREA) to cut its sales outlook for 2013 for the third time since last summer.

The number of homes that changed hands across the country over the Multiple Listing Service (MLS) in February came in 15.8-per-cent lower than a year ago, and 2.1-per-cent lower than January.

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2013 Q1 – Price Up Most Cities while Vancouver, Victoria, St. John N.B. Price Drop

April 15, 2013

Royal LePage said among 16 major markets in Canada, the country’s largest real estate company found that prices for all three major types of housing increased year-over-year and quarter-over-quarter in 13 markets; meanwhile Vancouver, Victoria, and Saint John, N.B., saw price declines in all housing types.

Royal LePage CEO Phil Soper acknowledges that there are some housing watchers who are anticipating big price declines in the Canadian market. But he says his firm hasn’t seen that happen yet, and doesn’t expect to.

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Canadian home sales slump as prices stay flat

October 17, 2012

CREA – Home sales declined in August even as prices ticked slightly higher.  The 8.9 per cent decline in activity is the largest annual drop since April 2011, CREA said, and was led by declines in major markets such as Vancouver, Toronto, Calgary, Edmonton and Ottawa.  On a monthly basis, sales were down by 5.8 per cent from July’s level, the largest drop in two years.

While the number of sales declined, prices held up. CREA says the average price of a Canadian home sold in August was $350,192, up 0.3 per cent from where it was a year ago.

 (click on Map)

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Canadian house prices edge up in third quarter while the number of home sales fall

October 16, 2012

TORONTO  – The Royal LePage House Price Survey released today showed the average price of a home in Canada increased year-over-year between 1.8 and 4.8 per cent in the third quarter of 2012.

Survey findings indicated that the average standard two-storey home in Canada increased 4 per cent year-over-year rising to $403,747, while detached bungalows rose 4.8 per cent to $366,773. Standard condominiums witnessed an increase of 1.8 per cent to $243,607. Most cities in Canada experienced modest price appreciation in the quarter, but fewer homes were sold compared to the same period in 2011.

 

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Canadian Real Estate Association cuts home sales forecast

October 16, 2012

OTTAWA — The Canadian Real Estate Association cut its 2012 and 2013 outlook for home sales and lowered its national average price forecast as it reported the biggest month-to-month drop in activity in two years.  The association said that tighter regulations on mortgage lending that came into effect in July helped push August homes sales to their largest month-over-month decline since June 2010.

Sales of previously owned Canadian houses and condos have now gone down in five of the past six months.  “While we always caution that housing market trends at the national level can and do run counter to trends in many local markets, the decline in activity in August was definitely the result of much of the country moving in the same direction,” CREA president Wayne Moen said in a statement.

CREA said sales were lower in about two-thirds of all local markets across Canada representing 80 per cent of national activity, with lower monthly sales in almost all large urban centres, Toronto, Montreal, Vancouver, the Fraser Valley, Calgary, Edmonton and Ottawa.

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Canada – Home price gains cooling but still hit record

September 14, 2012

Canadian home prices rose to another record high in July but moderating gains provided more evidence that the real estate market is cooling, according to a national benchmark index.

The Teranet-National Bank home price index showed that overall prices rose by 0.7 per cent last month — cooling from the 1.0 per cent monthly gains seen in each of the previous two months.

The index hit a new high for the third consecutive month.

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Canadian Home Prices Falling Steadily

August 22, 2012

An economist at BMO Financial Group called it the “Vancouver Manouevre”since price drops in the West Coast city brought down the national average despite 19 of 26 cities experiencing year-over-year increases.  The city’s average sale price dropped more than 12% to $667,462 from $761,763 last year.

Activity was up from the previous month in Kingston, Ont., Chilliwack, B.C., and Calgary, offset by fewer sales in Toronto, Newfoundland and Labrador, and Edmonton. Actual sales across the country were up 3.3% overall from a year ago.

Much of the decline in the national average can be blamed on Vancouver’s volatile market.


Edmonton Sees Job Boom in May

June 22, 2012

After a slow start to the year, Edmonton’s economy has bounced back with huge growth in the May job market.

Eight thousand jobs were created in the city last month, close to the kind of increases seen in 2005 and 2006.

“This is a boom month,” said John Rose, the city’s chief economist. “These kinds of job growth numbers are not sustainable in the long run because we’ll run out of people.”

Alberta’s energy industry is playing a big part in the growth, with new projects in the oilsands increasing the demand for construction companies around Edmonton.

For many builders, it not only means scrambling to find new workers but also holding on to the ones they already have.

“Certainly from a retention perspective we’re looking at different strategies to try to retain our employees because theres so much more competition,” said Sue Melik, director of talent and acquisition for Ledcor.

Transportation, finance and healthcare also saw jobs created, most of them full time.

Alberta is showing the highest employment growth in the country and is tied with Saskatchewan for the lowest unemployment rate at below 5%.

Source: CBC


Alberta economic snapshot for May 2012

May 31, 2012

Canadians in other provinces may have noticed a bit of sticker shock in April, but shoppers in Alberta were more likely to notice some price relief – especially for energy.

The annual rate of inflation (as measured by the Consumer Price Index) was a mere increase of 0.8 per cent last month in Alberta. That was by far the lowest rate of price increase across the country, and the lowest consumers in the province have seen since the depths of the recession in late 2010.

Canadian consumers overall saw general prices rise by 2.0 per cent year-over-year, up a bit from 1.9 per cent in March. The Bank of Canada’s core index – which strips out of the basket the eight items with the most price volatility – rose by 2.1 per cent.

Alberta’s dropping rate of inflation is not a reflection of weakening consumer demand or a slowing economy. The lower pace of inflation was driven almost entirely by a 27.7 per cent drop in natural gas prices and a 19.4 decrease in the price of electricity. These two items had been responsible for most of the inflation the province had seen in previous months. On the other hand, year-over-year prices for fresh fruit rose 9.6 per cent, auto insurance premiums rose 6.4 per cent and personal health and grooming products rose 5.1 per cent.

The modest increase in the national rate of inflation should do nothing to impact the Bank of Canada’s longer term view on the economy, nor will it prompt the Bank to accelerate its intentions to raise interest rates. The Bank’s target for overall inflation is 2.0 per cent – precisely the rate in April.

Housing

The Canadian Real Estate Association (CREA) released April’s resale housing statistics this week. After rising relatively rapidly over the last couple years, the pace of growth has declined significantly. National average statistics edged up 0.9 per cent in April relative to a year ago, hitting $376,000.

The data reflects an important regional dimension. The year over year increase in Saskatchewan, Newfoundland and Nova Scotia jumped over 10 per cent, but British Columbia’s housing market looks to have cooled considerably, where prices dipped 11 per cent. It should be highlighted that because of the high average price of real estate in B.C. that even a small percentage change represents a very significant amount of money (the 11 per cent drop represents $65,000, for example).

U.S. inflation

The Bureau of Labor Statistics released consumer price data for April 2012 this week. It indicates that inflation remains well contained, coming at 2.3 per cent in April, which is the lowest annual increase since February 2011. Energy prices appeared to be falling, relative to previous months, causing the rate of inflation to decline.

The relatively tame inflation numbers will leave the Federal Reserve with some room to increase monetary stimulus if the economic recovery falters – something that was alluded to in the minutes of April’s rate setting meeting.

U.S. housing

Two important indicators for the United States housing market were released this week: housing starts and the National Association of Home Builders (NAHB) Housing Market index. Both numbers came in better than expected.

Housing starts for April came in at 717,000, up 2.6 per cent from last month’s revised 699,000 figure. This is the highest recorded number since the end of 2008, but a far cry from the 2,000,000 annualized peak that Americans were building at the height of the building frenzy.

The reading from the NAHB housing market index was extremely optimistic, coming in at the strongest level since May 2007. The index is constructed from a survey that asks builders whether their sales expectations of single family homes was good, fair or poor and whether buyer traffic was high, average or low. The index is a forward looking index, meaning builders expect housing starts to rise higher over the coming months.

Energy

Natural gas prices have plunged recently, dipping below $2/btu, but the price has since come back somewhat, hitting $2.63/btu this week. What’s interesting to note is how unstable the price uncertainty is with respect to the future path of natural gas prices.

According to the short-term energy outlook from the Energy Information Administration (EIA) in the United States, natural gas prices aren’t expected to top $4/btu before 2014. The EIA used volatility in the market for the contracts that are paid for future delivery of the commodity (out to 2014) to construct a confidence interval. That is to say, the price is still pretty fluid for the commodity and there’s certainly a high probability for surprises to the upside as well as down.

Foreigners reducing Canadian debt

According to Statistics Canada, non-residents reduced their holdings of Canadian financial assets slightly in March by $2 billion. The decline was not in keeping with recent trends. Since March of last year, non-residents have purchased $50 billion worth of bonds, $15 billion worth of stocks and put $23 billion in Canadian money-markets – meaning foreigners have put a collective $87 billion into Canada.

Canadians, on the other hand, increased their holdings of foreign financial assets by $7 billion in March. Over the year, however, Canadians have been far less aggressive in buying foreign assets than the reverse – buying $20 billion in foreign assets, almost all of which being made up of foreign stocks.

Source: Troy Media


Edmonton March Stats – Real Estate Board of Edmonton

May 29, 2012
March-to-June period accounts for almost half the sales in the entire year.

According to data from the Edmonton Real Estate Board, sales and listings by were up last month. Listings were up 23.5 per cent from February and sales were up 24.5 per cent. The average price of a single family detached home in Edmonton was $380,083, up 1.3 per cent from February. The average price of a condominium in March was $231,629, down 1.4 per cent from the February price.

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