Home resales hit a new July record with 50,270 properties sold in Canada through the Multiple Listing Service. That is an 18.2% increase over the same month last year. Most interesting may be that this year over year increase is the largest in the past 2 years.
In the Canadian Real Estate Association’s press release, CREA President Dale Ripplinger stated, “The difference in the resale housing market now, compared to the beginning of the year, is night and day, and nowhere is this more evident than in the West. Homebuyers recognize that interest rates and prices have bottomed out, and are taking advantage of excellent affordability before prices and interest rates move higher.”
This has led to a 7.6% increase in the average price nationwide, though this number is exaggerated by the rebound in some of Canada’s priciest markets. For example, Vancouver had a 90% gain in the amount of sales over last year. Since that city has a very high average home price, the increase in the number of sales can greatly skew the national average.
What may have a continued effect on pricing is that the amount of active listings is down to 219,982, a 12.4% decline over July 2008, the largest drop in over six years. However, the recent price increase may attract more people that have been waiting for markets to recover before putting their house up for sale.
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Tom Drake is the owner and head writer of Canadian Finance Blog.
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Its a tricky market and I think a lot of people are going to get caught with their pants down thinking these numbers are an indication of a recovery.
It is good to see that Canada is making headway with the property market at such a time.