Canadian home sales drop 40 per cent in February compared with year ago

The Canadian Real Estate Association says homes sales in February dropped 40 per cent compared with a year ago.

Home sales in Canada plummeted 40 per cent last month compared with a year ago, with new listings and prices also dropping in what one economist called "hints of a bottoming process."

The plunge in sales came as prices declined 18.9 per cent compared with the all-time record posted in February 2022, the Canadian Real Estate Association said Wednesday.

The actual average home price in Canada was $662,437 in February, down from $816,578 a year earlier, the association said, referring to figures that had not been seasonally adjusted.

Compared with January, CREA said national home sales rose 2.3 per cent in February, powered by gains in Toronto and Vancouver, while the number of newly listed properties dropped 7.9 per cent month over month.

The drop in transactions in February brought sales in line with what was recorded in 2018 and 2019, suggesting the rise in interest rates over the past year "has blown off some of the pandemic era froth in Canada's housing market," BMO chief economist Douglas Porter said.

Despite sluggish sales last month, he said market dynamics showed signs of improvement in February.