Canadian home sales rebound

Sonya Khanna

Business Editor

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It seems it’s more than just the unseasonably mild weather that has Canadians in a stir.

Despite enduring a few bumps and bruises in early 2012, optimistic figures indicate a thriving Canadian home market for the month of February, shunning concerns of a housing bubble and sparking buyer interest.

Home sales rebounded in the month of February, with moderate year-over-year increases with experts suggesting fears of a housing bubble have been overstated. Figures released by the Canadian Real Estate Association depict growth in seasonally adjusted sales, up 1.4 per cent from January and 8.6 per cent from a year prior. The CREA reported a total of 61,772 home had been traded in early 2012, up 6.7 per cent from previous results.

“While sales remain healthy, prices are far from running wild nationally,” said Doug Porter, Deputy Chief Economist, BMO Capital Markets. “Average prices rose a moderate 2.0 per cent year over year following an even milder rise in the two prior months, dampening concerns about a housing bubble.”

The cooling housing market in Vancouver was offset by Double-digit price gains exhibited in three Canadian cities, including Toronto, Sudbury and Windsor, hinting at a broadly balanced market nation-wide moderating at its own accord. The number of newly listed homes for the month of February rebounded at 1.9 per cent on a month-over-month basis.

The national average price for homes sold in February, not accounting seasonal adjustments, demonstrated a hike of two per cent from the same month last year, to $372,763. The national average growth in prices for the previous year was sparked by an increase in the sale of high-end housing in Vancouver.

“The national rise in both sales activity and the number of newly listed homes beyond the normal seasonal increase provides clear evidence that Canadians are confident in housing market prospects,” said Gary Morse, President of CREA. “Confidence varies by region, as do prospects for housing demand. For that reason, buyers and sellers should talk to their local realtor to understand cialis online pharmacy current and prospective trends in their local housing market.”

Growth in both sales as well as in new listings has rejuvenated confidence among Canadians for housing market prospects. The national sales to new listings in homes above the seasonal average increase, provides a glimpse into market balance; it is a measure of overall balance in the housing market.

“Continued moderation is a welcome sign, and it bodes well for prospective homebuyers – particularly in a low interest rate environment,” said Katie Archdekin, Head of Mortgage Products with Bank of Montreal. “Canadians looking to buy a home should consider a 25-year amortization as a way to significantly reduce the amount of interest paid over the life of the mortgage.”

An unwavering balance between supply and demand in Toronto has boosted notably high gains in housing prices nation-wide, particularly for single and detached homes. Monthly data suggests demand preferences for the month of February have been skewed in favour of single and family homes, which generally tend to be on the expensive side of things. With this steady trend observed, the national average has succumbed to additional upward pressures.