MLS® records broken in May as average price rises above $300,000.
June 15, 2006 - REALTORS® in Canada sold more properties through the MLS® system in May than in any other month since the Multiple Listing Service® was created more than fifty years ago. Unadjusted sales in Canada's major markets totalled 37,460 units in May 2006, the highest level on record for unadjusted monthly sales, and an increase of 4.4 per cent from the previous record of 35,874 sales recorded in May 2005. It was not, however, a record on a seasonally adjusted basis.
New listings in Canada's major markets totalled 58,794 units in May 2006, which is also the highest level on record for unadjusted new listings, and an increase of 3.1 per cent from the previous record of 57,004 recorded in March 2006. Seasonally adjusted new listings numbered 46,117, which was the highest level since May 1991.
The MLS® residential average price in Canada's major markets passed the $300,000 mark for the first time in May 2006. The average price was $303,836, the highest level on record, and a year-over-year increase of 12.9 per cent from last May.
“May marks the fourth consecutive month in which the major market average price broke all previous records,” notes CREA Chief Economist Gregory Klump. “Sales activity continues to run high, despite rising interest rates and home prices. That shows how additional full time job growth, rising incomes and resilient consumer confidence are working together to keep housing demand strong.”
CREA’s Chief Economist also notes that recent price increases are resulting in a growing shortage of lower priced resale home listings in a number of markets. “That is crimping sales in lower price ranges and pushing up the average price for MLS® home sales.”
"A lot of first-time buyers are sitting on the sidelines because they can't afford to get in," says Gary MacLean, a REALTOR® with Re/Max Real Estate Central in Calgary. The city is one of the major markets that set a number of MLS® records in May, including average price. CREB reports the average residential price was up in May nearly $110,000 over last year to hit $358,214. Single-family homes led the way with the average hovering close to $400,000 for the first time ever - up almost 43 per cent compared to the same period last year.
Due to strong migration of people to the city, the demand likely won't diminish any time soon, although sales could slow down in the short term, says Calgary Real Estate Board President Kevin Clark. "With the summer market soon upon us, we would anticipate a softening of unit numbers in the weeks ahead, but the prices to remain on a positive trajectory," he says.
May 2006 will also go down in the Winnipeg Real Estate Board book for three records: most properties sold in a single month, first time monthly dollar volume beat $200 million, and first time three homes priced at more than a million dollars sold in a month. "These are some never-before-seen results," says WREB president Walter Boni. This is the fifth straight year the WREB is enjoying record sales in its 103-year history.
Residential-detached sales in Winnipeg in May were similar to last month with the most activity in the two price ranges between $130,000 and $199,999. Just under half of all houses sold through the Winnipeg MLS® sold for above the list price.
© Canadian Real Estate Association - 2006