Canadian home sales fall for fifth straight month, down 29% from July 2021

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Canadian home sales fell for a fifth consecutive month between June and July as buyers remained on the sidelines.

According to recent statistics from the Canadian Real Estate Association (CREA), national home sales fell 5.3% on a monthly basis in July. The actual number of sales last month was 37,975 — a 29.3% decline from July 2021.

Sales were down in roughly three-quarters of all markets, the CREA said, led by the Greater Toronto Area, Greater Vancouver and the Fraser Valley, Calgary, and Edmonton.

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Although July marked the fifth-straight month of declining activity, the CREA noted it was the smallest dip of the five.

“July saw a continuation of the trends we’ve been watching unfold for a few months now; sales winding down and prices easing in some relatively more expensive parts of the country as well as places where prices rose most over the past two years,” said Jill Oudil, chair of the CREA.

“That said, the demand that was so strong just a few months ago has not gone away, but some buyers will likely stay on the sidelines until they see what happens with borrowing costs and prices. As they re-enter the market, they’ll find a bit more selection, but not as much as might be expected.”

Nationally, the number of newly listed homes fell 5.3% month-over-month in July. The decline was “broad-based,” with listings falling in three-quarters of all markets.

With sales and new listings both down, the sales-to-new listings ratio remained unchanged from June at 51.7%, which is slightly below the long-term national average of 55.1%.

July ended with 3.4 months of inventory on a national level. Although still “historically low,” it has increased from the all-time low of 1.7 months seen at the beginning of 2022.

“One new piece of the puzzle was the decline in new listings in July. It was of the same magnitude as the decline in sales, and in many of the same parts of the country,” said Shaun Cathcart, CREA’s senior economist.

“It’s only one month of data at this point but it suggests that some sellers are also playing the waiting game, and that is with an overall inventory of homes for sale that is still historically low.”

Although not as large as the 1.9% decline seen in June, the Aggregate Composite MLS Home Price Index (HPI) fell 1.7% on a monthly basis in July.

As has been the case in recent months, the majority of the declines were seen in Ontario, although some dips were recorded in British Columbian markets, too. Prices were “more or less flat” across the Prairies, while Quebec began to see small declines, the CREA said.

The actual (not seasonally adjusted) national average home price hit $629,971 in July, down 5% from a year ago.

The figure is “heavily influenced” by sales in Greater Vancouver and the GTA, the CREA said. Excluding the two from the calculation cuts $104,000 from the national average price.

“We’ve already witnessed a sharp housing market adjustment this year,” Cathcart said. “But it will hopefully be short-lived if conditions continue to show signs of stabilizing.”

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