Average Canada home price is up more than $100,000 since January

The average price of a home sold in Canada jumped 4.3 per cent in April and is now up nearly 17 per cent since January as the country’s real estate market continued to show signs of a rebound, according to figures from the Canadian Real Estate Association.

The April housing data, released May 15, showed the month-over-month gain from March brought average non-adjusted price to $716,000, up more than $100,000 from January but still 3.9 per cent below the level of April 2022. The MLS Price Index is also up a more modest five per cent from January.

Sales, meanwhile, jumped 11.3 per cent for the month while new listings only edged up by 1.6 per cent, leaving new supply at a 20-year low, CREA’s report said.

CREA chairman Larry Cerqua said that means demand is once again outpacing supply.

“Over the last few months, there have been signs that housing markets were going to heat back up this year, so it wasn’t a surprise to see things take off after the Easter weekend, which often serves as the opener to the spring market,” Cerqua said in a press release.

In an interview, CREA senior economist Shaun Cathcart said the rebound in sales since January has been occurring across many markets in Canada, but disproportionately in Toronto and Vancouver.

“I think it’s going to transfer over from that compositional growth in the average and it’s going to shift into actual prices of individual homes now going up as more buyers re-enter the market, which is still very much under supplied,” he said.

With sales gains vastly outpacing new listings in April, the sales-to-new listings ratio jumped to 70.2 per cent, up from 64.1 per cent in March, CREA said.

Cathcart said the supply problem, along with demand being so strong, means Canada is still very much in a seller’s market.

“I was not surprised in April to see prices not just stabilize but start rising again. But I don’t think that they’re going to rise at the rate that they did during COVID,” said Cathcart.

With prices rebounding, Canada’s housing market may have reached a “price trough” or bottom in early January, Elton Ash, vice-president of Re/Max Canada, said in an interview.

Ash said the market appears to be going back to its “historical norm” in terms of interest rate levels.

“This is sort of what we knew would be occurring as we saw inventory levels dropping through the last year and we knew that buyers would become acclimatized to higher interest rates because they weren’t record high,” he said. “So really, this is just a continuation of Canadian confidence in homeownership and the desire to be in our own home.”

In a separate report, Desjardins economist Hélène Bégin said the latest figures show the seller’s market has become even more pronounced.

Bégin noted that high interest rates and construction costs are making financing difficult for some developers and builders, given that new home pre-sales are down.

“This housing market rebound isn’t good news for the Bank of Canada,” she wrote in the report. “The restrictive effect of past interest rate hikes isn’t stopping the housing market from recovering well.”