By Ketki Saxena
Investing.com – This week in Canadian housing included a slew of housing data, including new home sales, newly listed homes, housing starts, and two indices of home prices.
Sales of existing homes declined 12.6% between March and April 2022 and by over 25% year on year. Activity however still remains at a historical high, with this month’s figures still the third-highest ever recorded for April since the series began. Supply also remains tight, with newly listed homes dropping 2.2% in April, and housing starts increasing 8% to 267,330.
Pricing presents a slightly more mixed picture. The Teranet National Bank Index reported 2.7% increase in prices month over month, and an 18.8% annual gain in April for 11 benchmark locations, as well as annual increases over 5% in all Canadian metropolitan areas. The MLS HPI however, recorded a decline month on month, and a 7.4% increase year over year.
Incidentally, shelter costs measured by CPI also grew 7.4% year over year. The increase was driven by energy costs, other homeownership costs including commissions, and an increase in the mortgage index for the first time since April 2020.
Here’s a recap of this week in Canadian Housing Data:
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Existing home sales: Home sales recorded over Canadian MLS® Systems dropped by 12.6% between March and April 2022, and 25.7% lower year on year. However, home sales remain historically high, with this month’s figures the third-highest for the month behind 2021 and 2016.
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Newly Listed Homes and Housing Starts: The number of newly listed homes edged back by 2.2% on a month-over-month basis in April. The standalone monthly SAAR of housing starts for all areas in Canada increased 8% from March to 267,330 units in April.
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Teranet/National Bank home price index, which covers eleven CMAs around the country, reported an 18.8% annual gain in April, breaking last month’s record of 18.4% growth. Halifax led the way with a 34.8% year-over-year price increase, followed by Hamilton with a 28.9% gain, and Victoria and Toronto with 22.5% increases. The other 20 CMAs not included in the index also all saw increases, ranging from 5.8% in Lethbridge to 37.9% in Abbotsford-Mission. On a monthly basis, the index increased 2.7% from March to April, one of the strongest monthly increases ever recorded.
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The Aggregate Composite MLS® Home Price Index (HPI), in contrast, shows prices edged down 0.6% on a month-over-month basis in April 2022. The national average home price was a little over $746,000 in April 2022, up 7.4% year on year. The national average price is heavily influenced by sales in Greater Vancouver and the GTA, two of Canada’s most active and expensive housing markets
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CPI (Shelter) costs, incidentally reflected an increase similar to the HPI, rising 7.4% year over year, following a 6.8% increase in March. Higher prices for energy sources used to heat homes, such as natural gas (+22.2%) and fuel oil and other fuels (+64.4%), contributed to the increase. Homeowners' replacement cost - the component most closely related to the price of new homes, (+13.0%) and other owned accommodation expenses (+17.2%) which includes commissions on the sale of real estate, also grew. The mortgage interest cost Index (+0.2%) increased on a month-over-month basis for the first time since April 2020.