Canada’s existing home sales fall in April, housing activity and sentiment to be weighed on

Canadian existing home sales dropped in April for the fourth consecutive month. Sales dropped 2.9 percent. Around 60 percent of all local housing markets recorded lower sales than in the earlier month, with notable falls in Fraser Valley, Calgary, Ottawa and Montreal. Sales also declined in the GTA and GVA, though the rate of decline eased significantly in both markets. On the other hand, sales rose in Regina, Saskatoon, Edmonton, and Quebec City.

New listings fell 4.8 percent in the month, pulling back after two consecutive monthly gains. The biggest falls in listings were seen in Edmonton, Regina, Ottawa, Montreal and the GTA. The significant fall in new listings led the sales-to-listings ratio higher to 53.7 in April in spite of the fall in transaction activity – leaving markets comparatively balanced. Province wise, ratios stayed the lowest in Alberta, Saskatchewan and Newfoundland and Labrador. On the contrary, markets were comparatively tight in Quebec, Nova Scotia and P.E.I.

The average home prices dropped in April, declining to its lowest since 2015. Province wise, prices falls were seen in Ontario, Manitoba, Alberta, Quebec and Newfoundland and Labrador in the month. Prices also fell in the GTA while increasing for the first time since October 2017 in the GVA.

On a year-on-year basis, the quality adjusted MLS home price index slowed to 1.5 percent. Notable falls were seen in the GTA and in Oakville-Milton. On the contrary, quality-adjusted prices rose strongly in Montreal, Ottawa and Vancouver.

Housing activity continues to be negatively impacted by increased mortgage rates, the B-20 regulation and, in some markets, provincial regulations. These factors might continue to be a drag on activity and sentiment going forward, stated TD Economics.

“Ultimately, signs of stabilization should emerge later in the year and into 2019, amid healthy labour markets and ongoing population growth”, added TD Economics.

At 20:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was neutral at -36.8302, while the FxWirePro's Hourly Strength Index of US Dollar was highly bullish at 147.142. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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