Canadian Existing Home Sales Crash In January

After five straight months of acceleration, January saw Canadian existing home sales crash 14.5% - the biggest drop on record...

Home prices rose 2,3% over the past 12 months, but it appears a sudden close-eye on Chinese buyers has hit the market hard as Toronto home sales crashed a stunning 27% from December (prices down 4.4% YoY) and Vancouver sales down 10.5% MoM (prices up 18.1% YoY).

Canadian existing home sales are down 2.4% YoY.

Must be the weather, right?

This comes less than a week after horrific jobs data struck Canada - thanks to minimum wage-hikes.

The Canadian job market has never lost more part-time jobs - ever - than in January...

As a reminder, The Bank of Canada hiked 'dovishly' in January...

The BOC also noted that "while the economic outlook is expected to warrant higher interest rates over time, some continued monetary policy accommodation will likely be needed to keep the economy operating close to potential and inflation on target."

We suspect that hike-trajectory may slow further.


skbull44 LawsofPhysics Thu, 02/15/2018 - 09:16 Permalink

But the mainstream narrative continues to be that 'everything is awesome'...just ask any politician or mainstream media pundit. For example, CBC's lead stories today: Bombardier revenue up; Shopify revenue up; cannibis tax is a government windfall; and, home prices rise in Toronto for first time in 6 months...

The entire article on Canadian/Toronto housing is all about the price rise and how the housing market has turned a positive corner. There is no mention whatsoever of existing home sales falling off a cliff...go figure.…

In reply to by LawsofPhysics

Mtnrunnr LawsofPhysics Thu, 02/15/2018 - 09:41 Permalink

It doesn't matter that the sales drop, it only matters when proces drop. Also, the WORLD is under communist rule; more precisely under plutocratic rule so identifying the chinese as somehow different is confusing the issue. The rules are made by the rich to protect their assets whether those who own them have slanted eyes, broad noses or pigmentless skin. Wake the fuck up and stop calling one form of government or party names, they are ALL playing you for a fool. 

In reply to by LawsofPhysics

CRM114 GunnerySgtHartman Thu, 02/15/2018 - 10:34 Permalink

Yeah, we have, and round here it's very good.

Less than $200 a month is not the slightest problem if your expenditure is a nickel less than your income.

The mortgage lenders, outside GTA/Van, are being quite conservative. As a consequence, there is a hole developing in the mid-range of the market. Properties in the lower range, that most people can still get mortgages for, are selling like lightning, and increasingly being reno'ed 'off the books'. Properties at the high end are being built and sold like crazy too. Not much moving in the middle.

In reply to by GunnerySgtHartman

PrometeyBezkrilov CRM114 Thu, 02/15/2018 - 18:23 Permalink

Well, this all theoretical. If you expenses go up every month it is difficult to spend a nickel less than your income, since your income doesn't go up but the inflation does. I am not sure about you, but I am paying at the gas station the price when the barrel of oil was $150. Where is the f_cken market economy? Isn't my price supposed to be 3 times lower at the pump?

In reply to by CRM114

JuliaS GunnerySgtHartman Thu, 02/15/2018 - 13:15 Permalink

Don't forget the empty house tax put in place this month in Vancouver. I frequently visit Vancouver. I always find more high-rises than the last time. One thing remains common though. In the evening only about half the windows are light, indicating that a big portion of apartments are simply held for appreciation.

Foreign buyers tax, empty home tax, higher interest rates and speculative prospects of crypto currency have all done their job sharpening the ice pick that's going to put an end to this bubble... eventually.

In reply to by GunnerySgtHartman

Boing_Snap Martian Moon Thu, 02/15/2018 - 09:45 Permalink

Buying real things with counterfeit money finance, sounds like a familiar theme, now where did I hear that before? 

Not to worry folks interest rates are going up, the amount of debt coming to market to finance tax cuts and infrastructure will implode the debt markets. Real assets are being bought up with fake currency scams around the world, and that Ponzi is now starting its downward leg.

In reply to by Martian Moon

TradingTroll opport.knocks Thu, 02/15/2018 - 09:37 Permalink

There is no inventory in Vancouver either. Sales of existing housing stock are slow. New builds are bought by Asians usually, then lay empty. Then a few owners of existing houses put up a sign for a few weeks then give up.


Its tough because people have pulled so much equity from their homes there is no room for error and can easily be underwater.

In reply to by opport.knocks

AlphaSeraph opport.knocks Thu, 02/15/2018 - 09:43 Permalink

This is correct. The foreigners thing is partly correct. The reason people think it's foreign nationals, i.e. not Canadian citizens, is because in Toronto and Vancouver, the number of legal immigrants from China has been stunning. But they are Canadian citizens so in the numbers, they do not show up as foreign ownership.

Next - Toronto and GTA (Greater Toronto Area) is a swath of land that has been following the Agenda 21 rules for quite some time. Just look up "The Greenbelt"..."Welcome to the Greenbelt" is on most of the big city/provincial signs in the area. That's the Agenda 21 program and the area is designated as THE GREENBELT.

One of the major restriction of the UN program is to **severely** limit the development of land and building on it. Lo and behold, the GTA is one of the hardest places on Earth to get a damn permit to build a housing complex. With the unrelenting immigration to the area with severe restrictions on building you get supply shortages and massive price increases. This is the GTA in a nutshell.

In reply to by opport.knocks

RMiller Thu, 02/15/2018 - 09:26 Permalink

The foreign buyer tax was implemented a while back.

This is due to the more stringent mortgage rules that kicked in Jan. 1, requiring all buyers to be approved at 2 points above the current rate.

taketheredpill Thu, 02/15/2018 - 09:39 Permalink


New Mortgage "STRESS TESTING" came into effect in January.  You have to be able to prove that Mortgage Rates can rise +2% above current levels and you can still carry the house.

So a lot of people are failing the stress tests and it's impacting sales.  


Albertarocks Thu, 02/15/2018 - 09:54 Permalink

Canadian home sales ALWAYS crash in January.  The slowdown actually starts in October and continues through March, with January being the worst month.  Sales remain sluggish until the weather starts to warm up and then the number of sales peaks in May.  This pattern has repeated every single year since records have been kept.  Believe me, nobody wants to go out looking at 'homes for sale' when the temperature is -30°F.  This pattern is also related to the school year for the children.  Parents want to move as soon as the school year ends at the end of June.  So they have to buy the house by the end of May in order to be able to take possession by the end of June.  Once moved, the family can enjoy the summer.  This is not speculation on my part... this is how it works and has worked since records began.  I was in real estate for 10 years, so trust me on this one.

By the way, just as a reminder... this story is a repeat of the one ZH published last February.  And the February before that.  And the February before that.

The Real Tony AlphaSeraph Thu, 02/15/2018 - 11:09 Permalink

I've got news for you pal the only thing that matters is the Chink because the only driving force behind real estate prices in Canada is the Chink. Being from Alberta you should be among the first people to realize this as I still see apartments in Calgary and Edmonton that sell for closed to fifty thousand dollars. The same apartments in Chinkland British Columbia would sell for fifteen time that because of the Chink influence.

In reply to by AlphaSeraph

Ink Pusher Thu, 02/15/2018 - 11:30 Permalink

Our housing market is completely overpriced as much as 50% in easily 80% of the provinces.

Property Taxation levels are not affordable and the full time job markets are still sucking big furry moose balls.

With over half of the entire nation living paycheck to pathetic paycheck I don't see any realistic scenario which can remedy this continuing epic of debt and and value misrepresentation.

Nothing is selling because prices are set way too high and nobody can borrow enough to meet them at an affordable rate.