Near-Record Decline in Q1 GDP is Better Than Flash Estimate

General Robyn McLean 29 May

 

Great insight on the market today from Dominion Lending’s Chief Economist, Dr. Sherry Cooper.
The hand-wringing about the Q1 GDP data released today misses the point that the data were actually better than expected. The Canadian economy declined at an 8.2% annualized rate in the first quarter, less harsh than the earlier estimate by StatsCan of -10%. Of course, every sector of the economy was hit by the enforced shutdown, but not by nearly as much as most economists anticipated. For the month of March, the decline was 7.2%, less dire than the -9% earlier estimate.

In light of the current unprecedented national and global economic environment, StatsCan is providing leading indicators of economic activity. Their preliminary flash estimate for April is an 11% decline in real GDP. This estimate will be revised as more info becomes available, but the March and April decreases are likely to be the largest consecutive monthly declines on record.

The Economy Has Bottomed

It looks increasingly likely that we are already past the bottom of the latest economic downturn, with GDP potentially getting back on a positive growth trajectory as early as May.

That won’t be enough to prevent a historically large drop in Q2 output– likely multiples of the decline in Q1–but it would leave the data tracking along the more “optimistic” end of the -15% to -30% growth range estimated by the Bank of Canada in their last Monetary Policy Report. Government support programs for those losing work have been unprecedented–household disposable income actually edged up slightly in Q1 despite the large drop in overall economic activity, boosted by government transfers. With the decline in spending in March and April and the rise in disposable income, the savings rate is soaring. All of us are saving money by doing our own cooking and cleaning. We aren’t travelling and shopping is certainly limited, not to mention the savings on gasoline, entertainment, hairstyling and gym memberships. Hopefully, this could provide a cushion to support spending and the economy will turn sharply higher in Q3.

Still, the three million jobs lost over March and April will not be recouped quickly. The lockdown is easing only gradually, and any activities requiring large gatherings–think tourism, conferences, concerts, movies and sports–will remain closed until there is a vaccine or effective treatment. We expect things will begin to get better from this point, but still look for the unemployment rate to remain elevated at 8.5% in Q4 of this year. It is currently 13%.

The Housing Outlook

Much has been made of the recent CMHC Housing Market Outlook report released this week. The gloomy outlook of up to an 18% drop in home prices, a delayed recovery not until 2022, and a 20% arrears rate garnered headlines. First-time homebuyers were warned that housing was no longer a good investment, at least not over a three-year horizon. But the CMHC’s own data shows that home prices have risen an average of 5% annually over the past twenty-five years. And though no one’s retirement nest egg should consist solely of their residential real estate, a home is one of the few investments that you can actually use. People buy homes for many reasons well beyond wealth accumulation. The pride of ownership and lifestyle choice dominates the decision to buy for many.

Also this week, the Governor of the Bank of Canada suggested that the doomsters were overly pessimistic and asserted his view that the economy would recover from its medically induced coma much faster than the pessimists were suggesting. Clearly, none of us have a crystal ball, nor have we ever before experienced a pandemic recession. While we rise from the abyss, the pain may well be far from over. People are still losing jobs and many businesses continue to sink. Any recovery is dependent on whether the virus cases keep slowing and whether there is a second wave of infections.

But oil prices have risen sharply, a major boon for Alberta and some high-frequency data have improved. The stock market is well off its lows, interest rates have fallen sharply and the qualifying rate for mortgage stress tests has fallen to 4.94%. Actual mortgage rates are near record lows and are likely to remain low for the foreseeable future.

In time, immigration to Canada will restart, and foreign students will return. New businesses are blossoming even now and many sectors will continue to advance. To name a few, we are seeing burgeoning growth in telemedicine, artificial intelligence, big data analysis, cloud services, cybersecurity, 5G, home entertainment, virtual everything, home fitness, DYI renovations, indeed, DIY anything.

Downplaying dire doomsayers

General Robyn McLean 25 May

As always, some sound insight from our friends at First National

May 25, 2020
First National Financial LP

As the Canadian economy starts its slow walk back toward normalcy, or towards whatever the new normal is going to be, Bank of Canada Governor Stephen Poloz is calling out the doomsayers.

With about a week to go before he steps aside on June 2, Poloz says he believes the economy is on track for a healthy recovery from the COVID-19 pandemic, starting in the second quarter of this year.

“Where we are today suggests we’re still tracking to our best-case scenario … not the dire scenario,” Poloz told reporters during a video roundtable last week.

“I do believe the… [pessimism]… I’m hearing is a little too dire.  It’s a little overblown,” he said.

To Poloz’s way of thinking, too many forecasters are fixating on the collapse of the country’s GDP.  But he points out that the underlying “behavioral adjustment” by people, the “downward spiral in confidence” normally associated with recession and depression is not occurring.

The Governor’s theory appears to be born-out, at least modestly, by the latest read on consumer confidence by the Conference Board of Canada.  The figures for May show a 16 point increase in confidence from the record low of 47.5 hit in April.

The index now sits at 63.7 points.  That is still 60 points below the pre-lockdown reading in February.  But the numbers are also improving as Canadians look ahead.  There is less pessimism about future finances and worries about future employment have also eased.

Home sales fall, debt worries rise

General Robyn McLean 19 May

Insight on current market conditions from our friends at First National. 

May 19, 2020
First National Financial LP

The latest statistics from the Canadian Real Estate Association are stark but they should not be surprising.  April sales hit a 36-year low, down nearly 57% from a month earlier and down almost 58% year-over-year.

As with March, though, average prices remained steady.  Compared to a year ago the national average dipped 1.3% to just over $488,000.  With Toronto and Vancouver taken out of the calculation the national average drops by nearly $100,000.

CREA points out that its composite Home Price Index shows an increase of almost 6.5% YoY.

The association is not offering any forecasts on sales or prices going forward.

As the COVID-19 pandemic continues to run roughshod through the housing market, the Bank of Canada is repeating its concerns about high household debt.  The Bank sees the number of vulnerable households – those that put more than 40% of their income toward debt payments – increasing and falling behind on loan payments.

Calculations by the BoC indicate that up to one-in-five home-owning households do not have enough money to cover two months of expenses.  One-third do not have enough to cover four months.  Some 700,000 households have received deferrals, so far.

The central bank’s projections see the mortgage arrears rate climbing by about 0.8%, peaking next year when payment deferral plans offered by lenders start to expire.  This is the Bank’s current, worst case scenario.  The current mortgage arrears rate stands at just 0.2%.

Record Declines in Canadian Home Sales and Listings in April

General Robyn McLean 15 May

Today’s update with valueable insight from Chief Economist Dr. Sherry Cooper.

The pandemic shutdown has put every sector of the economy into a medically induced coma, so, of course, the housing sector is no exception. Data released this morning from the Canadian Real Estate Association (CREA) showed national home sales fell a record 56.8% in April, compared to an already depressed March, in the first full month of COVID-19 lockdown (see chart below). Transactions were down across the country.

Among Canada’s largest markets, sales fell by 66.2% in the Greater Toronto Area (GTA), 64.4% in Montreal, 57.9% in Greater Vancouver, 54.8% in the Fraser Valley, 53.1% in Calgary, 46.6% in Edmonton, 42% in Winnipeg, 59.8% in Hamilton-Burlington and 51.5% in Ottawa.

The residential real estate industry is not standing still, however. Technological innovation is creating new ways of buying and selling homes. According to Shaun Cathcart, CREA’s Chief Economist, “Preliminary data for May suggests things may have already started to pick up a bit for both sales and new listings, in line with evidence that realtors and their clients have adopted new and existing virtual technology tools. These tools have allowed quite a bit of essential business to safely continue, and will likely remain key for some time.”

I have heard agents discussing software that virtually “stages” properties, allowing potential buyers to see the possibilities of existing and renovated floor plans and options in decor and design. The software replaces the need for expensive “physical” staging and can be far more creative. Where there is challenge, there is opportunity, and the people that create and adopt these innovative virtual solutions could be big winners.

Keeping the lid on price pressures, the number of newly listed homes across Canada declined by 55.7% m-o-m in April. The Aggregate Composite MLS® Home Price Index declined by only 0.6% last month, the first decline since last May. While some downward pressure on prices is not surprising, the comparatively small change underscores the extent to which the bigger picture is that both buying and selling is currently on pause.
Mortgage Qualifying Rate Set To Drop

The mortgage qualifying rate, the so-called Big Bank posted rate, has been above 5% since the OSFI stress test began on January 1, 2018. Despite dramatic declines in the government of Canada bond yield, which currently hovers at a mere 0.388%, and a huge fall in contract mortgage rates, the banks have kept their posted rates elevated. The minimum stress test rate began in 2018 at 5.34%, then finally fell to 5.19% and more recently to 5.04%–all still at a historically wide margin above market-determined rates.

In the past week, RBC and BMO have cut their 5-year posted rates slightly further to 4.94%. If no other banks follow, the Bank of Canada’s OSFI stress test rate will fall to 4.99%. If at least one other bank goes to 4.94%, the qualifying rate will drop to 4.94%. Every little bit helps.

Highlights of the Bank of Canada ‘Financial System Review’ (FSR)

With the first news of the COVID-19 pandemic threat, the BoC report said that “uncertainty about just how bad things could get created shock waves in financial markets, leading to a widespread flight to cash and difficulty selling assets. Policy actions are working to:

  • restore market functioning
  • ensure that financial institutions have adequate liquidity
  • give Canadian households and businesses access to the credit they need”

The Bank of Canada’s actions have put a floor under the economy. These along with the federal government spending initiatives and the mortgage deferral program have cushioned the blow to households and businesses. Governor Poloz said, “our goal in the short-term is to help Canadian households and businesses bridge the crisis period. Our longer-term goal is to provide a strong foundation for a recovery in jobs and growth.”

With the economic outlook remaining highly uncertain, the BoC erred on the side of caution in projecting mortgage arrears and non-performing business loans based on the more severe economic scenario it laid out in the April Monetary Policy Report. The pessimistic reading would be that even with policymakers’ extraordinary actions, that scenario would see mortgage and business loan delinquencies eclipse previous peaks. A more optimistic reading would be that policy support has prevented a significantly worse outcome, and a resilient financial system will be able to absorb losses and leave the foundation in place for an eventual economic recovery. And, as Governor Poloz mentioned, a better economic scenario is still within reach as many provinces are beginning to gradually re-open their economies.

The projections in today’s FSR are based on a scenario in which Canadian GDP is 30% lower in Q2 and recovers slowly thereafter. In that scenario, mortgage arrears are projected to increase to 0.8% by mid-2021 from 0.25% at the end of 2019–nearly double the peak in arrears seen in 2009. Meanwhile, non-performing business loans are forecast to rise to 6.4% at the end of this year from 1% at the end of last year, significantly higher than past peaks of less than 5% in 2003 and 2010.

The upshot is that while we might see a significant increase in mortgage arrears and troubled loans over the next two years in this pessimistic economic scenario, these outcomes would have been much worse without the extraordinary programs that have been put in place to support businesses and households. That has important implications for the banking sector. The BoC’s analysis suggests that, with these policy measures, large bank’s existing capital buffers should be sufficient to absorb losses. Without those interventions, “banks would be faring much worse, with important negative effects on the availability of credit to households and businesses.”

Households:

  • 1 in 5 households don’t have enough cash or liquid assets to cover two months of mortgage payments
  • Government support programs (CERB payments and CEWS wage subsidies) will cover a large share of households’ “core” spending (food, shelter, and telecoms)
  • Loan payment deferrals (banks have allowed more than 700,000 households to delay mortgage payments) and new borrowing can help offset remaining income losses
  • Still, some households are likely to fall behind on their debt payments (first credit cards and auto loans, then mortgages)—something we’re already seeing in Alberta and Saskatchewan

Businesses:

  • There have been some signs of reduced funding stress in April: The Bank of Canada’s bankers’ acceptance program is shrinking, the drawdowns of credit lines have slowed as some borrowers are repaying, and corporate debt issuance picked up significantly in April after ceasing in March.
  • Surveys show higher-than-normal rejection rates for small- and medium-sized businesses requesting additional funding from financial institutions
  • Upcoming corporate debt refinancing needs are in line with historical levels, but many borrowers will face in increased costs of funds owing to elevated corporate risk spreads
  • Nearly three-quarters of investment-grade corporate bonds are rated BBB (the lowest investment grade rating)—downgrades would double the stock of high-yield debt and significantly increase funding costs for those borrowers
  • Firms in the industries most affected by COVID-19 tend to have smaller cash buffers, and a sharp drop in revenues will make it difficult to meet fixed costs including debt payments. What started as a cash flow problem could develop into a solvency issue for some businesses
  • The energy sector is facing particular challenges: it has had to rely more on credit lines, has the highest refinancing needs over the next six months and faces the most potential downgrades

Banks:

  • BoC’s term repos have provided ample liquidity to the banking system and reduced funding costs, hence the drop in some banks’ posted and contract mortgage rates
  • Take-up of term repos has slowed in recent weeks—an indication of improved market functioning
  • Regulators have eased capital and liquidity requirements

Governments:

  • The BoC’s asset purchases have helped improve liquidity in the key Government of Canada securities market (the baseline for many other bond markets)
  • The FSR made little mention of government debt sustainability, but in his press conference Governor Poloz noted that overall government debt levels are similar to 20 years ago, and federal debt is significantly lower, giving the federal government plenty of room to maneuver

Bottom Line:

Of course, the pandemic shutdown has strained the financial wherewithal of many households and businesses. That was deemed the price we must pay to mitigate the severe health threat and contain its spread. The BoC report acknowledges the economic fallout of the necessary measures and promises to take additional actions to assure the economy returns to its full potential growth path as soon as feasibly possible. Cushioning the blow for those most in need.

Nevertheless, there are businesses that will close permanently and others that will scoop up declining competitors. Some will benefit from the new opportunities created by social distancing, enhanced sanitation, remote activity, new forms of entertainment and advances in healthcare. Others will no doubt die, although many of these companies were at death’s door before the pandemic emerged. Creative destruction is always painful for the losers, but it opens the way for many new winners and those existing businesses and individuals that are creative enough to adapt quickly to the changing environment.

Pandemic Batters Canadian Job Market

General Robyn McLean 8 May

This too shall pass… news and insight from Dominion Lending’s Chief Economist Dr. Sherry Cooper

A Recession Like No Other

The Canadian economy has been put in a medically induced coma. Never before in modern history have we seen a forced shutdown in the global economy so, not surprisingly, the incoming data for April is terrible. There is a good chance, however, that April will mark the bottom in economic activity as regions begin to ease restrictions.

The economy will revive, but the psychological shock is perhaps the most unnerving. Rest assured, however that, as severe as this is, there are real opportunities here along with the challenges. There are economic winners, not just losers. More on that later.

Employment in Canada collapsed in April, with 2 million jobs lost, taking the unemployment rate to 13.0%, just a tick below the prior postwar record of 13.2% in 1982 (see chart below). The record decline is on the heels of the 1 million job loss in March, bringing the cumulative two-month total to 15.7% of the pre-virus workforce.

Economists had been expecting double the job destruction–a 4 million position decline in April–in reaction to the reports that over 7 million Canadians had applied for CERB. Today’s news reflected labour market conditions during the week of April 12 to April 18. The applications for CERB are more recent, so we may well see these additional losses reflected in the May report.

The 13% unemployment rate underestimates the actual level of joblessness. In April, the unemployment rate would have been 17.8% if the labour force participation rate had not fallen. Compared to a year ago, there were 1.5 million more workers on permanent layoff not looking for work in April – and so not counted as unemployed.Also, the number of people who were employed but worked less than half of their usual hours for reasons related to COVID-19 increased by 2.5 million from February to April. As of the week of April 12, the cumulative effect of the COVID-19 economic shutdown—the number of Canadians who were either not employed or working substantially reduced hours—was 5.5 million, or more than one-quarter of February’s employment level.

In April, both full-time (-1,472,000; -9.7%) and part-time (-522,000; -17.1%) employment fell. Cumulative losses since February totalled 1,946,000 (-12.5%) in full-time work and 1,059,000 (-29.6%) in part-time employment.

Decline In Employment is Unprecedented

The magnitude of the decline in employment since February (-15.7%) far exceeds declines observed in previous labour market downturns. For example, the deep 1981-1982 recession resulted in a total employment decline of 612,000 (-5.4%) over approximately 17 months.

More of the drop in employment now is the result of temporary layoffs. In April, almost all (97%) of the newly-unemployed were on temporary layoff, whereas in previous recessions, most of the dismissals were considered permanent.

In April, more than one-third (36.7%) of the potential labour force did not work or worked less than half of their usual hours, illustrating the continuing impact of the COVID-19 economic shutdown on the labour market. But job losses were also still weighted, on balance, more heavily in lower-wage jobs. Average wage growth for those remaining in employment spiked sharply higher as a result to 11% above year-ago levels.

All provinces have been hard-hit

Employment declined in all provinces for the second month in a row. Compared with February, employment dropped by more than 10% in all regions, led by Quebec (-18.7% or -821,000).  Quebec leads the country in the number of COVID-19 cases and deaths.

The unemployment rate rose markedly in all provinces in April. In Quebec, the rate rose to 17.0%, the highest level since comparable data became available in 1976, and the highest among all provinces (see table below). The number of unemployed people increased at a faster pace in Quebec (+101.0% or +367,000) than in other regions.

Employment dropped sharply from February to April in each of Canada’s three largest census metropolitan areas (CMAs). As a proportion of February employment, Montréal recorded the largest decline (-18.0%; -404,000), followed by Vancouver (-17.4%; -256,000) and Toronto (-15.2%; -539,000).

In Montréal, the unemployment rate was 18.2% in April, an increase of 13.4 percentage points since February. In comparison, the unemployment rate in Montréal peaked at 10.2% during the 2008/2009 recession. In Toronto, the unemployment rate was 11.1% in April (up 5.6 percentage points since February), and in Vancouver, it was 10.8% (up 6.2 percentage points).
Employment Losses By SectorIn March, almost all employment losses were in the services-producing sector. In April, by contrast, employment losses were proportionally larger in goods (-15.8%; -621,000) than in services (-9.6%; -1.4 million). Losses in the goods-producing sector were led by construction (-314,000; -21.1%) and manufacturing (-267,000; -15.7%).

Within the services sector, employment losses continued in several industries, led by wholesale and retail trade (-375,000; -14.0%) and accommodation and food services (-321,000; -34.3%).

Industries that continued to be relatively less affected by the COVID-19 economic shutdown included utilities; public administration; and finance, insurance and real estate.

In both the services-producing and the goods-producing sectors, the employment decreases observed in the two months since February were proportionally larger than the losses observed during each of the three significant labour market downturns since 1980.

As economic activity resumes industry by industry following the COVID-19 economic shutdown, the time required for recovery will be a critical question.

After the previous downturns, employment in services recovered relatively quickly, returning to pre-downturn levels in an average of four months. On the other hand, it took an average of more than six years for goods-producing employment to return to pre-recession levels following the 1981-1982 and 1990-1992 recessions. After the 2008-2009 global financial crisis, it took 10 years for employment in the goods-producing sector to return to pre-crisis levels.
Green Shoots

As bad as things are, there is some evidence that the economy is approaching a bottom. Business shutdowns are easing in most provinces, and while it will be some time before we see a complete reopening, early signs of improvement are evident. Business sentiment appears to have improved somewhat towards the end of April, as evidenced by data from the Canadian Federation of Independent Business. The Royal Bank economists report that credit card spending looked less weak at the end of April. Housing starts for April held up better than expected. And, most importantly, the spread of Coronavirus has eased, and regions are starting to relax some of the rules to flatten the curve.

Concerning the housing market, before the pandemic, we were going into the spring season with the prospect of record sales activity in much of the country. Aside from oil country–Alberta and Saskatchewan–all indications were for a red-hot housing market. So the underlying fundamentals for housing remain positive as the economy recovers. How long that will take depends on the course of the virus and whether we see a second wave in late fall. 

Interest rates have plummeted. Thanks to the 150 basis point decline in the prime rate, variable rate mortgage rates have fallen for the first time since late 2018. Once the Bank of Canada was able to establish enough liquidity in financial markets, even fixed-rate mortgage rates have fallen. 

The posted mortgage rate appears stuck at 5.04%, far above contract rates; but with any luck at all, this qualifying rate for mortgage stress tests will ease in the coming months. The Bank of Canada will remain extremely accommodating. In my view, interest rates will not rise until 2022.

Opportunities–There Will Be Winners

Even now, some businesses are enjoying a surge in revenues and profitability. Just to put a more positive note on this period of rapid change, I jotted down a list of companies that are thriving. Top of the list is Shopify, a Canadian company that helps businesses provide online shopping services. Shopify is now the most highly valued company in Canada, as measured by its stock market valuation, surpassing the Royal Bank. 

Many who never relied on online shopping have become converts during the lock-down. Amazon is another business that is benefiting, but Amazon needs more competition, and many Canadians would welcome some homegrown online rivals.

Loblaws, with its groceries and drug stores, is booming. So are the cleaning products companies like Clorox and paper products company Kimberly Clark. Staying at home has boosted sales at Wayfair, the online furniture and home products site. Peloton and suppliers of dumbbells and other fitness equipment are seeing increased revenues as people look for in-home alternatives to the locked-down gyms and health clubs. 

Demand for cloud services has boosted revenues at Microsoft and Dropbox. Home entertainment is booming, think Netflix and YouTube. Zoom and Cisco (Webex) are also big winners. Qualcomm stands to gain from a more rapid move to 5G. And Accenture and Booz Allen, among other business and government consultants, are busy helping companies reinvent their operations in a post-pandemic world.

In times of enormous uncertainty and volatility, people need expert advice and hand-holding, particularly concerning their finances. That’s where mortgage professionals come in along with financial planners, realtors, accountants and tax lawyers. 

The new boss. Same as the old boss?

General Robyn McLean 5 May

Strong & stable news with insight from our friends at First National.

May 4, 2020
First National Financial LP

The Bank of Canada has a new Governor.  And it could be said that everything old is new again.

Current Governor Stephen Poloz will step down, as scheduled, at the start of next month.  He will be replaced by Tiff Macklem, an old hand at the central bank.

Macklem is currently the dean of the Rotman School of Business at the University of Toronto, but he has a long history at the Bank of Canada and was the senior deputy governor under Mark Carney.  He was also a deputy to finance minister Jim Flaherty and helped guide Canada through the Global Financial Collapse and the Great Recession.

Macklem’s experience with that crisis appears to have been a key factor in his appointment, as Canada now faces the economic fallout of the coronavirus pandemic.

Macklem and the Bank of Canada are in a tight spot.  They have run out of room to reduce interest rates and they are spending billions of dollars a week buying government bonds.  Macklem has already expressed his reluctance to see interest rates go negative, calling that move “a new source of disruption”, in an already disrupted financial system.

Given Macklem’s record we can look forward to a more staid, Carney-like, Governor.  (Stephen Poloz has been positively lively compared to many of his predecessors.)  As during the last crisis, the Bank could work to calm markets and investors with more forward guidance.  And, it is unlikely Macklem will tinker with the Bank’s 2% target for inflation, which he helped develop back in 1991.

Home Sales and Listings Down Amid COVID-19, New Tools and Practices Emerge to Help Buyers and Sellers Adapt

General Robyn McLean 4 May

Current market stats and how the market is adapting to the Covid situation from our friends at the Real Estate Board of Greater Vancouver.

While Metro Vancouver home sale and listing activity remains limited by the COVID-19 situation, REALTORS® across the region are fast adopting new tools and practices to help advise and serve their clients in a responsible way.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential home sales in the region totalled 1,109 in April 2020, a 39.4 per cent decrease from the 1,829 sales recorded in April 2019, and a 56.1 per cent decrease from the 2,524 homes sold in March 2020.

Last month’s sales were 62.7 per cent below the 10-year April sales average and was the lowest total for the month since 1982.

“Predictably, the number of home sales and listings declined in April given the physical distancing measures in place,” Colette Gerber, REBGV’s president-elect said. “People are, however, adapting. They’re working with their Realtors to get information, advice and to explore their options so that they’re best positioned in the market during and after this pandemic.”

Realtors have been named an essential service by the provincial government to help the home buying and selling community meet their housing needs during the pandemic.

“We’re seeing more innovation in today’s market, with Realtors using different technology to showcase homes virtually, assess neighbourhood amenities with their clients and handle paperwork electronically,” Gerber said.

There were 2,313 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in April. This represents a 59.7 per cent decrease compared to the 5,742 homes listed in April 2019 and a 47.9 per cent decrease compared to March 2020 when 4,436 homes were listed.

The total number of homes currently listed for sale on the MLS® system in Metro Vancouver is 9,389, a 34.6 per cent decrease compared to April 2019 (14,357) and a 2.3 per cent decrease compared to March 2020 (9,606).

For all property types, the sales-to-active listings ratio for April 2020 is 11.8 per cent. By property type, the ratio is 10 per cent for detached homes, 14.7 per cent for townhomes, and 12.4 per cent for apartments.

Generally, analysts say downward pressure on home prices occurs when the ratio dips below 12 per cent for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,036,000. This represents a 2.5 per cent increase over April 2019 and a 0.2 per cent increase compared to March 2020.

“Home prices have held relatively steady in our region since the COVID-19 situation worsened in March,” Gerber said.

Sales of detached homes in April 2020 reached 388, a 33.8 per cent decrease from the 586 detached sales recorded in April 2019. The benchmark price for detached properties is $1,462,100. This represents a 2.3 per cent increase from April 2019 and a 0.8 per cent increase compared to March 2020.

Sales of apartment homes reached 503 in April 2020, a 43.2 per cent decrease compared to the 885 sales in April 2019. The benchmark price of an apartment property is $685,500. This represents a 2.7 per cent increase from April 2019 and a 0.2 per cent decrease compared to March 2020.

Attached home sales in April 2020 totalled 218, a 39.1 per cent decrease compared to the 358 sales in April 2019. The benchmark price of an attached home is $796,800. This represents a 2.8 per cent increase from April 2019 and a 0.6 per cent increase compared to March 2020.