Home sales across the country are starting to fall back from highs seen earlier in the year, but the Canadian Real Estate Association still expects the number of transactions during 2021 to set a new record.

MayB次元官网网址檚 56,156 sales were a 7.4 per cent drop from AprilB次元官网网址檚 60,638, the association reported, and month-over-month sales declines occurred in close to 80 per cent of all markets.

The number of transactions in May was a significant drop compared with a year ago, when the COVID-19 pandemic was spreading rapidly through the country, but the association expects sales to edge toward more typical levels through the latter half of 2021 and into 2022.

The association is predicting 2021 will see transactions rise 23.8 per cent from last year to reach a record-setting 682,900, then fall by 13 per cent to around 594,000 units in 2022.

CREA chair Cliff Stevenson attributed the slowing sales numbers to higher prices, a lack of supply and a general malaise spreading in many markets.

B次元官网网址淢ore and more, there is anecdotal evidence of offer fatigue and frustration among buyers, and the urgency to lock down a place to ride out COVID would also be expected to fade,B次元官网网址� he said, in a release.

CREA believes the declines in sales will be largest in B.C. and Ontario, where pre-pandemic bidding wars and soaring prices became even more intense during the health crisis.

It said these declines will create a B次元官网网址淪impsonB次元官网网址檚 Paradox,B次元官网网址� where the average price in every province will experience a larger year-over-year increase than the national average because sales will shift away from the most expensive provincial markets.

The association expects the average home price will rise by 19.3 per cent on an annual basis to hit $677,775 this year and then edge up by less than one per cent to reach $681,500 in 2022.

The highest average home prices are expected in B.C., where CREA forecasts they will reach $883,781 in 2021 and 896,304 in 2022.

Ontario will trail close behind with an average price of $859,533 this year and $887,031 next.

The most affordable housing will be found in Newfoundland and Labrador, where homes will sell for an average $272,964 in 2021 and $279,937 in 2022.

Adil Dinani, a B.C. agent with Royal LePage West Real Estate Services, isnB次元官网网址檛 surprised by the forecasts based on what he sees in his area.

B次元官网网址淲hile the market has stabilized and weB次元官网网址檙e no longer seeing rapid price growth, weB次元官网网址檙e still very much in a sellerB次元官网网址檚 market,B次元官网网址� he said.

B次元官网网址淭hereB次元官网网址檚 still a shortage of quality inventory and thatB次元官网网址檚 across all segments B次元官网网址� until that narrative changes, weB次元官网网址檙e going to see prices hold.B次元官网网址�

The national average price of a home sold in May was a little over $688,000, up 38.4 per cent from $497,189 during the same month last year.

When the Greater Vancouver and Greater Toronto areas are removed from that calculation, the average price sank by nearly $140,000, CREA said.

The average price in May was $1,179,831 in Greater Vancouver alone and $1,108,462 in the GTA.

Across the entire country, the association said the number of new listings fell 6.4 per cent to 74,466 in May, down from 79,572 in April.

Listings were down in about 70 per cent of markets with the Halifax-Dartmouth region seeing a 32.4 per cent decline compared to April, the biggest drop seen across the country.

The smallest decreases were in Greater Vancouver, Saskatoon, Regina, Trois-Rivi猫res and Sherbrooke, which were down by less than one per cent each.

On a sales-to-new listings basis, BMO Capital Markets senior economist Robert Kavcic said the tightest markets remain in cottage country areas like the Okanagan in B.C. and Kawartha Lakes in Ontario.

He attributed the cooling materializing nationally to a combination of buyer fatigue, five-year fixed mortgage rates edging up, policy measures like the bump in the mortgage qualification rate and the stampede out of out larger cities that Canada saw as companies increasingly allowed remote work.

B次元官网网址淗ome sales have backed off from extreme levels seen in recent months, but current activity is still historically strong and fostering outsized price growth,B次元官网网址� Kavcic wrote in a note to investors.

B次元官网网址淲e believe that sales activity will continue to gradually cool in the year ahead, but itB次元官网网址檚 going to take higher interest rates to soften the market in a meaningful way.B次元官网网址�

B次元官网网址擳ara Deschamps, The Canadian Press