Canadian home sales jump in December; 2023 sales fall 11.1%

TORONTO (Reuters) – Canadian home sales rose in December to end the year on an upbeat note after the market was buffeted by higher borrowing costs in 2023, data from the Canadian Real Estate Association showed on Monday.

Home sales rose 8.7% in December from November and were up 3.7% year-over-year, the largest year-over-year gain since August.

“While December did offer up a bit of a surprise in sales numbers to cap the year, the real test of the markets’ resilience will be in the spring,” Larry Cerqua, chair of CREA, said in a statement.

Home sales totaled 443,511 units in 2023, a decline of 11.1% from 2022 and the lowest annual level since 2008.

The Bank of Canada has said it could start lowering rates from a 22-year high of 5% this year if core inflation comes down as predicted.

CREA forecast that sales would rebound 10.4% in 2024 and then climb 7.3% in 2025.

The industry group’s Home Price Index fell 0.8% on the month and was up 0.7% annually, while the national average selling price was up 5.1% on the year.

(Reporting by Fergal Smith; Editing by Lisa Shumaker)