Canada Existing Home Sales Fall in June

Xavier Trudeau
Juillet 17, 2017

Transactions last month were down 6.7 per cent compared with May on a national basis, the third consecutive monthly decline, with the Greater Toronto Area registering a 15.1 per cent drop.

With sales having also declined in April and May, activity in June came in 14.1 per cent below the record set in March. This report reflects the impact of the measures made by Ontario to cool housing, which took effect in late April.

"The recent increase in interest rates could reinforce a lack of urgency to purchase or, alternatively, move some buyers off the sidelines before their pre-approved mortgage rate expires. In the meantime, some move-up buyers who previously purchased a home before first selling may become more motivated to reduce their asking price rather than carry two mortgages", said Gregory Klump, CREA's chief economist.

Sales were down from the previous month in 70 per cent of all local markets measured by CREA, including the Lower Mainland in B.C., Montreal and Quebec City.

In Vancouver, where the provincial government put its own foreign buyers tax in place past year, home prices we up 2.2%, the steepest hike since May 2007.

Data released today from the Canadian Real Estate Association showed prices slipping on slow sales.

Separately, mortgage interest rates have started to rise in recent days.

CREA suggests new housing demand will be negatively impacted by last week's rate decision, when the Bank of Canada increased its benchmark rate to 0.75%.

The industry group said actual sales, not seasonally adjusted, slumped 11.4 per cent from June 2016, while home prices surged 15.8 per cent from a year earlier, according to the group's home price index.

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