Canadian existing home sales are down by 9.3 per cent in November from year ago levels, but the market shows signs of stabilizing, according to a report released Wednesday.
The Canadian Real Estate Association says 32,947 changed hands last month down from the record 36,330 in November of 2009. In the key Toronto market, sales were down even more, by 12.6 per cent.
“Following the chilling lows at the onset of the recession and the dizzying heights during the subsequent recovery, the national housing market appears to be returning to some semblance of normalcy,” said CREA Chief Economist Gregory Klump. “Rising interest rates and weaker expected job growth are likely to contribute to softer prospects for housing activity and average price growth next year.”
The national average price was up by only two per cent from November of last year to $344,268.
While year over year numbers were down, seasonally adjusted activity rose for the fourth consecutive month, up by 4.8 per cent in November over October.
“The market now appears well balanced with neither buyers nor sellers holding a meaningful edge,” said BMO Capital Markets economist Robert Kavcic.
Seasonally adjusted sales are 19.5 per cent above the low point reached in July.
“The persistence of large year over year declines from last year’s record levels has been masking the steady improvement in national sales activity since July,” said Klump.
CREA says the market has been firming since it bottomed in July. One reason is that some potential vendors have taken their homes off the market because of economic uncertainty.
New listings remain 14.6 per cent below the peak in April of this year.
But CREA doesn’t expect that to last for long, as more competition will keep pricing low.
“An increase in new listings is likely to return many sellers markets to balanced territory within the coming months,” said Klump. “Sellers who previously shied away from putting their home on the market are expected to list their home in response to improved housing demand.”