According to statistics compiled by the Canadian Real Estate Association (CREA), the number of national home sales fell 1.3% from June to July, which is the third consecutive monthly decline. The average price of real estate continues to increase, however.
In a report released on August 15, the CREA notes that there were similar monthly declines in May and June, pushing national sales activity in July 3.9% below the record set in April 2016. Although there was a drop in the number of sales, the national average sale price was 9.9% higher than one year ago. Even when hot markets in the Greater Toronto Area (GTA) and Greater Vancouver are removed from the calculations, the average sale price in Canada advanced 7% year-over-year.
Single family homes prices up by 15.9%
The CREA notes that the biggest year-over-year gains were in single family homes, where prices increased by 15.9%, followed by townhouse/row units, one-storey single family homes, and apartment units which were up by 15.3%, 14.3%, and 11.1% respectively.
“Home sales continued to trend lower while price gains further accelerated in the Lower Mainland of British Columbia,” says CREA’s chief economist Gregory Klump. “This suggests that sales are being reined in by a lack of inventory and a further deterioration in affordability. The new 15% property transfer tax on Metro Vancouver home purchases by foreign buyers took effect on August 2nd, so it will take some time before the effect of the new tax on sales and prices can be observed. That said, the new tax will do little in the short term to increase the supply of homes.”