Spring has Sprung, and Home Sales were Up in March!
Well, we knew it couldn’t last forever, this slight softening or cooling we’ve been in lately. And while we may revert back to those days, for now spring has sprung and the country actually saw an increase in March sales when compared month over month!
As reported by the Canadian Real Estate Association, the number of homes that exchanged hands through MLS and other listing systems rose 2.4 per cent on a month-to-month basis. The cities with the biggest pushes on last month were Greater Vancouver, Fraser Valley, Calgary, Greater Toronto, Montreal, Saskatoon, Hamilton-Burlington, and Kitchener-Waterloo.
“National sales have been holding fairly stable since last summer,” said Laura Leyser, CREA president. “We’ll be watching closely as the spring market picks up to see whether the March sales increase marks the beginning of an improving trend. In the meantime, it’s important to remember that local market conditions often can and do differ from what’s reported at the national level, so buyers and sellers should really speak to their Realtor to understand how the housing market is shaping up where they live or might like to.”
But there’s more good news. Sales went up in March, even though they really shouldn’t have. The Easter holiday fell in March this year, and it had an entire full weekend at the end of the month, which was “extra days,” more commonly referred to as a “trading day effect” in the real estate world. But even in today’s cooling environment, the month of March overcame and still saw a positive climb.
“Easter and trading day factors combined effectively to cut March sales short,” said chief economist at CREA, Gregory Klump. “Activity in the months ahead will reveal whether the monthly improvement in seasonally adjusted March sales reflects technical seasonal adjustment factors or a fundamental improvement in demand.”
But, Mr. Klump thinks that this does speak to an improving market, because March 2012 did not have all the same factors working against it (holidays, etc.) Because of that, it was thought that the gap between February sales and March sales in 2013 would be bigger – but it actually closed some.
“That said,” Klump continues, “the factors that crimped March sales this year were not in play for the same month last year, resulting in speculation that the gap between sales activity this March and March of last year would be bigger than it was in February. That the gap in fact improved marginally speaks to the resilience of housing demand in Canada.”
Still, March 2013 sales were significantly down from 2012 sales – by a whopping 15.3 per cent. That’s still better than the 15.9 per cent we fell to in February of this year, but it still stings. Mr. Klump says that we shouldn’t worry too much about that, though.
“Analysis will likely continue to focus on how sales remain down from last year, but this shouldn’t come as a surprise given that mortgage regulations and lending guidelines at that time were yet to be tightened,” he says. “Since those factors came into force, national home sales have held fairly steady, notwithstanding the rise in seasonally adjusted March sales.”