In a sign that Canadian mortgage and housing markets may be recovering from a mid-summer swoon, Reuters reports that “sales of existing homes in Canada in August rose 4.1 percent from July, the first monthly increase since March,” according to just released numbers from the Canadian Real Estate Association (CREA).
According to CREA numbers, “32,807 homes changed hands in August, with most of the monthly gains concentrated in the two biggest markets, Ontario and British Columbia, a reversal from the previous month.”
While this is good news for Canadian mortgage and housing markets (which saw home sales in July slump 22.5%, as compared with July 2009), “the general trend is still likely to be of further moderation in Canada’s housing market,” an analysis that is consistent with a recently released forecast from RBC Economics.
Reuters reports that “(s)ales volumes and prices heated up in the first half of this year as buyers sought to avoid stricter mortgage rules and new blended sales tax regimes in Ontario and British Columbia that came into effect at mid year.” Meanwhile, the rise in the CREA’s August home sales numbers were accompanied by housing prices on par with those of August 2009 and a 1.9 percent rise in new home listings.
The CREA numbers reported by Reuters are reassuring news for Canadian mortgage and housing markets; nevertheless, CREA president Georges Pahud, cautions that, “Rising interest rates and a projected slowdown in job growth mean that the Canadian housing market is expected to continue to cool.” Presumably, a cooling that is an inevitable market correction from the torrid pace and price of home sales in late 2009 and the first half of 2010.
