Home sales in December hit an all-time record for the month to end what was also a record year, the Canadian Real Estate Association said Friday.
December sales were up 47.2% compared with December 2019, the largest year-over-year gain in monthly sales in 11 years, the association said.
Sales for the month were also up 7.2% compared with November.
The record-shattering December marked the sixth consecutive month of year-over-year home sales hikes, after the Covid-19 pandemic led to shutdowns across the country in the key March to May home sales season.
“This sweeping strength in sales heavily suggests that what’s driving this market are broad overall factors, and not local economic factors. Specifically, the plunge in interest rates last year and the pandemic-driven move to upgrade have lifted all markets,” said Douglas Porter, chief economist at BMO Capital Markets Economic Research, in a client note about CREA’s report.
“Suffice it to say, it wasn’t at all obvious that this is how things would play out 10 months ago.”
For 2020 as a whole, CREA said some 551,392 homes were sold, up 12.6% from 2019, and a new annual record. In December, the seasonally adjusted annual rate of home sales was 714,516, topping 700,000 for the first time.
The actual national average home price was a record $607,280 in December, up 17.1% from the final month of 2019. CREA said excluding Greater Vancouver and the Greater Toronto Area, two of the most active and expensive markets, lowers the national average price by almost $130,000.
Many of the areas with the biggest price gains last month were in Ontario, including Belleville, Simcoe, Ingersoll, Woodstock and the Lakelands region, where prices were up more than 30% from December 2019.
Areas with more modest price growth included Calgary and Edmonton, where prices rose 1.5% and 2.7%, respectively.
Shaun Cathcart, CREA’s senior economist, said listings of new homes will the “stat to watch” this year heading into the spring selling season, amid a “major supply problem” that could affect affordability.
Cathcart said there were fewer than 100,000 homes listed for sale to start this year, the lowest level ever recorded CREA’s system, which dates back three decades. Five years ago, there were about 250,000 listings, he said in a statement.
“We already have record-setting sales, but we know demand is much stronger than those numbers suggest because we see can see it impacting prices,” Cathcart said.
“So we have record-high demand and record-low supply to start the year. How that plays out in the sales and price data will depend on how many homes become available to buy in the months ahead.”