“For the year up until now, things have played out how we anticipated,” Gregory Klump, chief economist for CREA, told REP on Monday. “We hadn’t foreseen such a harsh winter. But for the three month period – March, April, May – things played out the way we expected.”
The trade association said it now expects national house sales to reach 463,400 units in 2014, a 1.2 per cent increase over 2013. The price of houses is also expected to rise, jumping 5.7 per cent to a national average of $404,300, due in part to increases in Calgary and Toronto where single-family homes are in short supply.
In March, CREA expected 2014 sales of 463,700 units. However, treacherous winter weather across the country prompted several sellers to defer listing until spring.
“If you take a look at March, April, May, coming into the spring market, and with activity as strong as it was in May, people were just hanging back just because of that winter,” Klump said.
Those deferred listings in May improved sales activity, but now that those homes are sold, CREA warned of a potentially slow summer.
“We don’t expect that momentum to continue,” Klump said. “Compared to May, we think sales will go down a bit, just because of those deferred sales and the market having caught up.”
In British Columbia, sales are expected to increase 8.3 per cent in 2014, while Alberta sales are expected to rise 3.8 per cent this year. Sales in Ontario and Manitoba are expected to be flat, while all of the eastern provinces are expected to see decreases for the year; CREA predicted sales in Quebec to fall 1.7 per cent, with sales in New Brunswick, Nova Scotia and Newfoundland and Labrador dropping 4.2 per cent, 5.1 per cent and 2.6 per cent, respectively.
Looking to 2015, CREA expects housing sales to rise approximately 0.9 per cent to 467,800 units, with the average price rising 0.7 per cent to $407,300.
A particularly bleak winter season may have deferred many house purchases, but the warming market and the still-low mortgage rates have prompted the Canadian Real Estate Association (CREA) to essentially maintain its earlier housing forecast for 2014.