Market News

Canada’s housing market remained subdued in February, with national home sales slipping 1.3 per cent month over month, while non-seasonally adjusted transactions were down 1.8 per cent from a year ago, according to the latest data from the Canadian Real Estate Association (CREA).

Compared to January, which had a surge of new listings, February was marked by a pullback in new supply. The number of newly listed properties fell 3.9 per cent month over month, nudging the national sales-to-new-listings ratio up slightly to 47.6 per cent from 46.4.

Phil Soper, president and CEO of Royal LePage, said the current housing correction has been relatively “symmetrical,” with supply and demand slowing equally on both sides. Sellers often test the market but withdraw listings if showings or offers fail to materialize, while move-up buyers delay selling if suitable homes for sale are scarce, he said.

Prices continued to edge lower in February, with the national MLS Home Price Index falling 0.6 per cent compared to the previous month, down 4.8 per cent from a year earlier. However, the national average home price was largely unchanged, dipping 0.2 per cent year over year to $663,828.

Robert Kavcic, senior economist at BMO Capital Markets, said the broader trend reflects what he describes as a “long and slow” downturn, with housing conditions still varying widely from region to market segment.

High-priced markets like Toronto and Vancouver had some of the steepest benchmark price declines at 7.9 per cent and 6.7 month-over-month, respectively. Sales in those markets also declined, falling 6.3 per cent in Toronto and 9.3 per cent in Vancouver.

Southern Ontario’s condo market is struggling and has “all but dried up… investors are absent,” Kavcic said in the bank’s Canadian Housing Monitor. He added that apartment prices are experiencing more pressure than single-family homes.

Sales activity in some Prairie and western markets, including Edmonton and Winnipeg, increased modestly, while Montreal’s remained flat.

“February saw a continuation of the quieter levels of activity recorded in January, although there was some indication things were starting to pick up speed toward the end of the month,” said Shaun Cathcart, CREA’s senior economist.

He also said buyers in Ontario and British Columbia may continue to wait for further price declines.

Clay Jarvis, mortgage spokesperson at NerdWallet, said the much discussed “pent up demand” that was expected to be unleashed this spring may still face headwinds. “The demand’s there, but for a lot of Canadians this probably doesn’t feel like an opportune time to be sinking your life savings into a single purchase,” he said.