Bank of Montreal economist Benjamin Reitzes says he expects average housing prices to be up about 6 per cent year-over-year.Kevin Van Paassen/The Globe and Mail
The Canadian Real Estate Association will be releasing April's housing data on Thursday, and the report is expected to show that prices are strong even though sales have been lacklustre.
"Price gains remain firm in much of the country, with average prices expected to be up about 6 per cent year-over-year, steady from the prior month," Bank of Montreal economist Benjamin Reitzes wrote in a research note.
"The quality-adjusted MLS house price index, a better representation of market conditions, looks to accelerate to 5.4 per cent year-over-year, a 29-month high," he added. (The MLS home price index, released by CREA, adjusts for changes in the types and locations of dwellings that are selling in an attempt to create a more accurate measure of underlying prices than the average price, which could be swayed if, for example, an expensive neighbourhood suddenly became more popular.)
CREA, which represents real estate agents, gathers MLS information each month from local real estate boards across the country and then discloses the national numbers. Some of the local boards have already disclosed April's numbers. The average selling price in Edmonton was up 4.5 per cent from a year ago, to $365,045; Toronto's average selling price rose 10.1 per cent to $577,898; Ottawa's average price ticked up 0.8 per cent to $374,015; Regina's remained relatively flat, at $317,176.
"Prices continue to rise despite cooling activity, reflecting relatively tight supply in major markets," Mr. Reitzes wrote. He, like many economists, questions whether the price momentum can be sustained. "Pricing tends to lag sales, so we could see prices come under mild pressure toward the middle of the year," he wrote.
He predicts that the number of existing homes that sold via the Multiple Listing Service in April will be about 2 per cent higher than a year earlier. If he's right, that would leave sales a little bit higher than they were in March, and would make April the third month in a row of sales gains after five consecutive monthly declines.
Toronto's volume of sales for April was up 1.8 per cent from a year earlier, Regina's and Vancouver's were each up about 16 per cent, and Montreal and Ottawa's each fell by about 9 per cent.