Canadian Existing Home Sales (February 2024)

Rishi Sondhi, Economist | 416-983-8806

Date Published: March 18, 2024

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Canadian home sales and prices declined in February

  • Canadian existing home sales declined 3.1% month-on-month (m/m) in February, leaving them 9% below their pre-pandemic level. Nation-wide, sales were driven lower by declines in Ontario and B.C. (both down -7.2% m/m), as well as Alberta (-2% m/m). In contrast, sales posted a relatively steep gain in Quebec (+6.3% m/m), last month.
  • New listings increased 1.6% m/m in February. Notably, listings were at or below long-term norms in every province but B.C. in February. With sales declining and listings rising, the Canadian sales-to-new listings ratio dropped to 55.6% last month – roughly matching its long-term average. 
  • Canadian average home prices declined 1.5% m/m in February. By province, relatively steep declines were recorded in B.C. (-1.0% m/m), Manitoba (-5.3% m/m) and Nova Scotia (-3.1% m/m). In contrast, comparatively steep rises were observed in Saskatchewan (3.8% m/m), and across other parts of the Atlantic. Prices were down 0.7% m/m in Alberta and 0.6% in Ontario, while being flat in Quebec.
  • The MLS home price index, a more "like for like" measure, was flat in month-on-month terms in February, as detached prices were up a touch and condo prices were slightly lower.  

Key Implications

  • Sales activity took a breather in February, likely weighed down by the upward creep in bond yields from the beginning of the year through the middle part of the month. And even though Canadian home sales have been highly volatile in the past few months, they're still tracking a solid first quarter gain. Should this increase manifest, it would support residential investment growth in the first quarter and help to partially offset what looks to be a Q1 decline in housing starts. We should also note that Canadian home sales remain well below pre-pandemic levels, due to subdued activity in B.C., Ontario, and Quebec. This suggests that significant pent-up demand remains in these markets.
  • Canadian average home price growth declined in February, and relatively loose conditions in Ontario and B.C. should keep it subdued over the next few months. That said, conditions in markets outside of these two provinces are much tighter, suggesting that firmer increases are likely outside of B.C. and Ontario.

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