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Canadian existing home sales rise sequentially in December

Existing home sales in Canada grew sequentially in December, rising for the fifth straight month. Sales were up 4.5 percent, putting sales right back to where they were before their summer slump. The year 2017 as a whole, saw sales decline 4 percent despite the gains. This marks the first drop in five years and the worst performance for sales since 2010.

Province wise, sales rose in all provinces except for Nova Scotia in December. Sales in B.C rose 5 percent, whereas Ontario recorded gains of 3 percent. Prairies also recorded sharp rise in sales. Sales rose slightly in Quebec, taking the year-on-year gain to a robust 8.4 percent.

New listings rose in December to their highest level on record; however, the 3.3 percent rise lagged behind the strong sales gain leading the national sales-to-new listings ratio higher in the month. In spite of a slight pull-back, B.C. continued to see the highest sales-to-new listings ratio of all the provinces, with the 63 percent figure showing a relatively tight resale market that should be supportive of price growth going forward, noted TD Economics in a research report.

The average home prices were up for the fifth straight month, rising 0.8 percent in December. In spite of the rise, the average transaction price continues to be around 3 percent lower than its April 2017 peak. Prices were sharply higher in Ontario and Nova Scotia. Overall, prices were up 4.1 percent in 2017, the slowest in five years.

However, most of the fall in average prices seems to be linked to a shift in activity away from higher priced regions, with the share of GTA sales in the national dropping from 21 percent to 18 percent.  The MLS home price index rose sharply by 14.1 percent in 2017, its most rapid rate on record. On a sequential basis, the quality adjustment HPI slowed to 9.1 percent in December. This deceleration in price growth greatly reflects the single-family market. In the meantime, apartment prices rose around 20 percent year-on-year and row/town house prices also saw a double-digit gain in the month.

At 20:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was bearish -92.2393, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at -47.5244. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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