Canadian existing-home sales via the Multiple Listing Service surged to a new high in May, according to statistics released today by The Canadian Real Estate Association.
Actual (unadjusted) sales activity totaled 54,184 units last month — the highest activity level for any month on record — and is an increase of 5.5 percent compared to the previous record set in May 2005. Seasonally adjusted sales activity posted a monthly increase of 2.9 percent due mainly to higher sales in Ontario and British Columbia. Transactions reached their highest monthly level on record in New Brunswick, and set a record for the month of May on a national basis and in Alberta, Saskatchewan, Quebec, Nova Scotia and Prince Edward Island.
Actual (unadjusted) new listings also reached the highest level for any month on record in May. New listings totaled 84,896 units last month, up 7.2 percent from a year ago, and are up 6 percent from the previous peak reached in March 2006. Seasonally adjusted MLS residential new listings numbered 65,884 units in May, up 1.3 percent from April, and are at the highest monthly level in more than 15 years.
Although new listings are on the rise, brisk sales activity is keeping the market tight and supporting further price increases, CREA reported. Sales activity in the second half of the year is expected to drift slightly lower due to rising prices and recent interest-rate increases, but the number of homes trading hands via the MLS remains on track to set an annual record in 2006.
The national MLS residential average price shattering all previous monthly records and reached $284,620 in May, up 13.1 percent compared to the same month in 2005, which is the biggest year-over-year increase in average price since October 2002. May was also the fifth consecutive month in which year-over-year price growth exceeded 10 percent. MLS residential average price reached its highest monthly level on record in British Columbia, Alberta, Saskatchewan, Ontario and Quebec, and set new records for the month of May in every other province except Newfoundland.
On a year-to-date basis, transactions for the first five months of 2006 were up 5.6 percent compared to the same period last year. Sales activity reached the highest level for the first five months of any year on record in all provinces except Ontario and Quebec.
“Resale housing markets remain tightest in Western provinces, and that’s being reflected by price increases there,” said CREA Chief Economist Gregory Klump. “Sale-price increases in Western markets have been driving the national average sale price upward, and that trend is expected to persist over the rest of the year.”
“Demand for resale homes continues to run high, despite rising interest rates and home prices,” Klump added. “This shows how additional full-time job growth, rising incomes and resilient consumer confidence are working together to keep resale housing activity buoyant. Listings are on the rise in many markets, which should help the market to become more balanced and rein in price gains in the second half of the year.”