Canadian existing home sales come in flat in may, activity likely to find support and recover in H2 2018
Source: FxWire Pro - Commentary / 17 Jun 2018 02:18:21 America/New_York
Canada’s existing home sales came in flat in the month of May. Sales dropped 0.1 percent, marking the best performance so far in 2018 after activity fell sharply by 21 percent through April. About half of all local housing markets recorded fewer sales in the month, led by the B.C. markets of Okanagan-Mainline, Chilliwack and the Fraser Valley. Meanwhile, sales rose in Calgary, Edmonton, Regina and Ottawa. In terms of the largest markets, sales came in flat in Montreal, while increasing for the first time in 2018. Sales in Vancouver fell a bit in the month, though the rate of decline eased from prior months.
New listings rose 5.1 percent in the month, more than reversing the fall recorded in April. Marked rises were seen in Calgary, Edmonton, Saskatoon, Regina and Ottawa. Listings also rose in Montreal, the GVA and the GTA.
With new listings higher and sales essentially unchanged, the sales-to-new listings ratio dropped to 50.6 in the month from 53.2 in April – becoming even more balanced. Provincially, the ratio was lowest in Alberta, Saskatchewan and Newfoundland and Labrador, indicating towards downward price pressures in these markets. On the contrary, ratios came in higher in Manitoba, Ontario, Quebec and the other Atlantic Provinces. In the meantime, in B.C., the ratio fell to 48.6.
The average home prices rose for the second consecutive month in May. Gains were recorded in B.C., Saskatchewan, Manitoba, Quebec and Newfoundland & Labrador. Prices also rose in the GTA while increasing for the second consecutive month in the GVA.
On a year-on-year basis, the quality adjusted MLS home price index slowed to 1 percent. Marked declines were seen in the GTA and in Oakville-Milton. On the contrary, quality-adjusted prices rose strongly in Montreal, Ottawa and Vancouver.
“Going forward, we expect activity to find support and begin to recover very gradually in the second half of the year. While rising borrowing costs will weigh on activity and prices, the housing market should nonetheless improve, supported by low unemployment, rising wages, and healthy population growth”, stated TD Economics.
At 19:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was bearish at -83.1776, while the FxWirePro's Hourly Strength Index of US Dollar was highly bullish at 121.863. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex
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