After posting gains in overall market activity in January and February, real estate sales in both March and April have weakened at a time when traditionally the market picks up with the arrival of spring. Unit sales in April were down 19% from April of last year while dollar revenue dropped 17%. Year-to-date unit sales to the end of April are now 13% behind 2010 with 517 properties having sold this year as compared to 595 last year. Sales revenue for the first four months has held up much better down just 13% driven by increased activity at the upper end of the market. Year-to-date we have had 12 sales over $1 million reported through the MLS® system of the Georgian Triangle Real Estate Board (GTREB) versus 5 sales over $1 million in the first four months of 2010.
Following the recessionary slowdown of 2008 and 2009, sales bounced back very strongly in the first half of 2010 then fell off later in the year. As a result, we are comparing monthly sales in the early part of 2011 to some very healthy sales activity in the first half of last year. Two addtional factors that have invariably affected sales of late is the weather and the federal election. Weather during the month of April was unseasonably cool, wet and just plain dull and did little to inspire the home buying public. A more significant factor perhaps in dampening sales was the recent federal election. The uncertainty leading into either a federal or provincial election the results of which could bring about change in economic policy and or taxation etc. is bound to halt many from making large purchasing decisions.
The Canadian Real Estate Association (CREA) has forecasted a drop in residential unit sales for 2011 of 1.3%. Sales activity across the country is expected to gain momentum in the latter half of 2011 as the economic recovery continues and employment strengthens. If this is the case, market activity in 2011 will mirror that of 2009 when sales returned with a vengence in the latter half of the year, particularly during the 4th quarter. This far, 2011 is shaping up very much like 2009 and only time will tell if this is indeed the case.