Canadian home prices remain incredibly calm, cool, and collected
While it’s too early for victory laps, evidence is building that the Canadian housing market has pulled off the “fabled soft landing”, says Doug Porter, chief economist for BMO Capital Markets.
Sales of existing homes climbed 0.6% in April from March, which trimmed the year-over-year decline to 3.1%, the Canadian Real Estate Association said on Wednesday.
Following the blockbuster housing starts and permits earlier this week, there was much hope that finally the NAR would confirm that the housing recovery was more than just another weather fabrication, and once again the dead cat has bounced, overtaking the sales high from last July. Alas, moments ago the NAR reported that after rising by 5.21 million units in March, April existing home sales dropped -3.3%, well below the 0.8% expected increase to 5.23 million.
TORONTO — The latest Royal LePage housing survey shows average price of a home in Canada increased between 1.2% and 3.8% in the fourth quarter of 2013.
It says the average cost of a standard two-storey home rose 3.6% year-over-year to $418,282, while detached bungalows went up 3.8% to $380,710.
Royal LePage says the price of a standard condominium rose 1.2% during the quarter to an average of $246,530.
The Home Depot, Inc. (HD) will release second-quarter results for its fiscal ‘14 (2QFY14) tomorrow, before the markets open. Analysts have revised down earnings estimates by 0.3% to $1.44 since the company’s last quarter – which is still growth of 16.13% year-over-year (YoY). Sales are expected to grow 7.6% YoY to $23.58 billion in the second quarter. The stock has gained 2.11% since its first-quarter earnings release.
The way things used to work, the housing sector was typically the one to lead the United States out of economic hard times. That’s because central bankers tend to loosen monetary policy coming out of a recession, and mortgage demand – and thus, the health of the housing market – is particularly sensitive to interest rates. But the sector didn’t play its usual role after the 2007-2008 global financial crisis. In fact, it has grown more slowly than even the most conservative expectations.
Following last month's disappointing drop in Existing Home Sales (ignored by most since other housing data provided just enough smoke and mirrors to confirm any inherent biases), May saw Home Sales surged 5.1% (handily beating expectations for a 4.4% rise after the 3.3% drop in April). At 5.35m SAAR, this is the highest rate of sales since Nov 2009 at the end of the government's last housing bailout plan spiked sales.