CREA:July Home Sales -2.1%; Months Supply Highest Since Jan'16

By Yali N'Diaye   

     OTTAWA (MNI) - Existing home sales dropped for the fourth consecutive month

in July, when they were down 2.1% from June to 39,392, with indicators of sales,

inventory and prices showing signs of a housing market slowdown, notably in

Ontario, where sales fell 5.0% on the month.

     In particular, conditions were "more balanced" in the Greater Golden

Horseshoe (GGH) area - which includes the Toronto region - targeted by tighter

provincial housing rules since April 20, The Canadian Real Estate Association

reported Tuesday.

     On a 12-month unadjusted basis, sales fell 11.9%, but were little changed

excluding the GGH area.

     "July marked the smallest monthly decline in Greater Golden Horseshoe home

sales since Ontario's Fair Housing Plan was announced in April," said CREA Chief

Economist Gregory Klump. "This suggests sales may be starting to bottom out amid

stabilizing housing market sentiment. Time will tell whether that's indeed the

case once the transitory boost by buyers with pre-approved mortgages fades."

     In July, the Bank of Canada raised its overnight rate target by 25 basis

pints to 0.75%, helping drive mortgage rates higher.

     New listings declined 1.8% to 73,664, leaving the sales-to-new listings

ratio little changed at 53.5%, in a "well-balanced" territory.

     "In the Greater Golden Horseshoe region, housing markets that recently

favored sellers have become more balanced, with some beginning to tilt toward

buyers' market territory," CREA said.

     There were 5.2 months of inventory at the end of July, up from 5.0 in June,

and the highest since January 2016.

     The national average price edged down 0.8% on the month to C$488,904. On a

12-month unadjusted basis, the average prices contracted 0.3%, posting its first

decline since February 2013.

     The Aggregate Composite MLS Housing Price Index was down 1.5% on the month

for a 12-month gain of 12.9% in July, representing a further slowdown since

April.

     CREA said softer prices in the Greater Golden Horseshoe region led the

slowdown, including a 4.7% monthly decline in Greater Toronto, where the HPI

rose 18.1% from July 2016.

--MNI Ottawa Bureau; +1 613 869-0916; email: yali.ndiaye@marketnews.com

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