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Canadian Existing Home Sales (June 2024)

Rishi Sondhi, Economist | 416-983-8806

Date Published: July 12, 2024


Canadian home sales increased in June

  • Canadian existing home sales increased 3.7% month-on-month (m/m) in June, leaving them 8% below their pre-pandemic level. Nation-wide, sales were driven higher by gains in Ontario (+6.1%m/m), Quebec (+4.2% m/m), B.C. (+2.7% m/m) and Alberta (1.4% m/m). However, sales were up in every province except in PEI's volatile market.
  • New listings rose 1.5% m/m in June, pushing them a touch above their long-term average. With sales rising faster than new listings, the Canadian sales-to-new listings ratio tightened by about 1 ppt to 53.9% - still below the long-run average. Meanwhile, total properties available for sale through the MLS system advanced 0.5% m/m in June.
  • The Canadian average home price increased 1.5% m/m in June. By province, relatively strong gains were recorded in Nova Scotia (+2.5% m/m), Manitoba (+2.4% m/m), and Ontario (+1.6% m/m).
  • The MLS home price index, a more "like-for-like" measure, edged higher by 0.1% m/m, driven by detached units, where prices were up 0.2% m/m. In contrast, condo prices fell 0.2% m/m. Note that condo markets are generally better supplied than those for detached units.  

Key Implications

  • The combination of lower yields and more supply available for purchase was enough to push sales higher last month. However, activity is still quite subdued, as sales levels remain low. Compositional forces were again at play (e.g., a larger share of higher-priced homes sold) last month, as average prices advanced a robust 1.5% m/m, while monthly growth in quality-adjusted benchmark prices was nearly flat. The Bank of Canada also cut their policy rate last month, although this didn't move the dial on affordability to any significant degree.
  • Recall that the capital gains inclusion rate increased from 50% to 67% in last month, which may have upwardly pressured supply, with investors and owners listing their properties to get ahead of the late-June implementation deadline. Unfortunately, data gaps preclude a definitive statement on the matter.
  • Notably, benchmark prices increased (albeit modestly) for the first time in 11 months. This could be a harbinger of improved activity ahead. Indeed, we think that markets will be stronger in the back half of the year, as the economy holds up and more meaningful interest rate relief is delivered. However, stretched affordability conditions will likely limit the degree of improvement.