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:
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.
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.
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.
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
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.