January marks another all-time record for home sales in Canada according to the Canadian Real Estate Association (CREA).
Based on the data, home sales in January increased by two per cent month-over-month, while activity was up 35.2 per cent year-over-year.
Additionally, the number of newly-listed properties dropped by 13.3 per cent from December 2020 to January 2021—this includes double-digit drops in the GTA, and Hamilton-Burlington area.
However, without a significant increase in new supply, this trend will not be sustainable.
“2021 started off just like 2020 ended, with a number of key housing market indicators continuing to set records. The two big challenges facing housing markets this year are the same ones we were facing last year—COVID and a lack of supply. It’s looking like our collective efforts to bring those COVID cases down over the last month and a half are working,” Costa Poulopoulos, chair of the CREA, said in a news release.
“With luck, some potential sellers who balked at wading into the market last year will feel more comfortable listing this year. As lockdowns are once again easing and the spring market begins to ramp up, we will remain vigilant in adhering to all the latest government and health officials’ directives to keep our clients safe. Now as always, REALTORS® remain the best source for information and guidance when negotiating the sale or purchase of a home,” he continued.
Further, with sales increasing and supply dropping, the national sales-to-new listings ratio hit 90.7 per cent—the highest level on record by a significant margin.
Moreover, only roughly 20 per cent of local markets were in the balanced-market range in January, the remaining 80 per cent were above long-term norms for a record-number of seller’s markets.
According to the findings, year-over-year prices in the GTA and Mississauga rose 10 to 15 per cent, and 20 to 25 per cent in Hamilton and Oakville-Milton.
“It’s the dead of winter and we’re only just starting to get the second wave of COVID under control. We’re unlikely to see a rush of listings until the weather and public heath situations improve, and we won’t see buyers until those homes come up for sale,” Shaun Cathcart, senior economist for the CREA, said in the same release.
“The best-case scenario would be if we see a lot of sellers who were gun-shy to engage in the market last year making a move this year. A big surge in supply is what so many markets really need this year to get people into the homes they want, and to keep prices from accelerating any more than they already are,” Cathcart continued.