Housing sales declined nationwide last month, according to the Canadian Real Estate Association (CREA), signalling that the national market is following a trend that emerged in its largest city.
Although actual sales surged by 256% compared to April 2020, which was the first full month of COVID-19 pandemic-related lockdown measures, thereby illustrating a flawed picture of what’s actually happening in the housing market, transactions declined last month by 12.5% from the all-time high recorded in March. Moreover, activity was down in 85% of Canada’s housing markets, including nearly all Ontario and British Columbia.
Nevertheless, the reduction in sales activity might start restoring some balance, although how much remains to be seen, in the Canadian real estate market.
“While housing markets across Canada remain very active, there is growing evidence that some of the extreme imbalances of the last year are beginning to unwind, which is what everyone wants to see happen,” said Cliff Stevenson, CREA’s chair. “That said, the slowdown in sales activity between March and April was at a time that COVID cases, including very concerning variants, hit their highest levels ever and many jurisdictions enacted fresh lockdowns, making it harder to get a clear read on the underlying levels of demand and supply. 2021 may be another year where some of the spring market gets pushed into the summer by COVID-19.”
But while sales might have been down on a monthly basis, sale prices were up 42% year-over-year, marking the largest ever increase, although April 2020 was when the worst numbers ever were published.
New listings declined by 5.4% month-over-month in April, despite March setting a listings record, indicating that there is still a healthy amount in the national housing market, and CREA suggested demand remains high. The sales-to-new-listings ratio fell to 75.2% in April from a peak of 90.6% in January, but it is still historically high and well above the long-term average of 54.5%.
In Toronto, COVID-19 measures enacted through all of April explain the drop in housing sales, says Davelle Morrison, a broker with Bosley Real Estate.
“I was selling a condo at Spadina and Bloor, which had over 50 showings, listed at $598,000, and on offer night we sold for $706,500,” Morrison told CREW at the end of April. “This week I have another condo listing in Yorkville that’s over 1,000 sq ft, and you’d think it’d be hopping, but with the new stay-at-home order, things are quieter. I only have nine showings so far and the offer night is coming up on Monday.”