In what marks a further sign of a softening real estate market, sales of existing homes in Canada dropped for a fifth straight month in January, but the home prices continued to climb.
The Canadian Real Estate Association announced Friday that the sale of existing homes fell 3.3 per cent from December to January, marking five consecutive months of decline. Home sales in January were 9.1 per cent below the peak that was reached last August, the association said in a statement.
Sales were down on a month-over-month basis in more than 60 per cent of all local markets in January, with declines in the Greater Toronto Area, Greater Vancouver Area and parts of southern Ontario including London, St. Thomas and Windsor-Essex, the CREA said.
CREA Chief Economist Gregory Klump said harsh winter weather that hit large swaths of the country in January may be one of the reasons behind the drop.
"Canadian housing market performance in January was a weather report of sorts, with January's Polar Vortex having dented both resale activity and new construction," Klump said.
"We'll be keeping a close eye on February's numbers for signs of a rebound in Southern Ontario, where sales reflected deferred home purchases due to cold weather rather than home buyers getting cold feet."
Compared to a year ago, home sales in January were up 0.4 per cent, with gains in British Columbia and Calgary offsetting declines in Ontario, Quebec and the Maritimes, the CREA said.
Meanwhile prices are continuing their climb upwards with the national average home price in January reaching $388,553. That's an increase of 9.5 per cent compared to January 2013.
The MLS Home Price Index, which the CREA has said is a better indicator of price trends, rose 4.8 per cent year-over-year in January, with a growth in prices among all property types.
According to the MLS HPI index, Calgary and the Toronto area posted the biggest price gains year-over-year at 8.98 per cent and 7.06 per cent respectively.
CTV News' Chief Financial Commentator Pattie-Lovett Reid said Canada's housing market remains fairly balanced.
"We're seeing slight pull backs," she told CTV News Channel Friday. "You really see that the market is still in fairly balanced territory. Sale prices were up 9.5 per cent year-over-year, but a more accurate reading is the MLS home price index, and that was up 4.8 per cent. That's pretty consistent."