Sales of existing homes in Canada increased by 0.8 percent in June 2014, reaching the highest monthly level on record in about four years as prices continue appreciating in several major parts of Canada.
While this would typically bode well for any housing market, the Canadian housing market has been a major talking point for its critics, largely due to the incongruence between hot and cold markets in the country. “Sales have improved compared to their slower start earlier this year,” said Canadian Real Estate Association president Beth Crosbie in a prepared statement. “That said, there are still important differences in how housing markets are faring depending on location.”
For example, Toronto, which is Canada’s largest housing market, had an average sales price of $568,953 in June 2014, a 7.1 percent increase year-over-year. Total sales in Toronto were also higher by 12.3 percent from June 2013, another sign that the city’s market just keeps heating up. Conversely, the average sales price in Montreal was up by just 0.9 percent year-over-year to $332,462, while sales activity increased by only 3.4 percent from the previous June.
Homes in Canadian capital Ottawa sold for an average of $365,366 last month, good for a 1.7 percent year-over-year increase, while total sales were up 4.4 percent from the last year.
The CREA also predicted that the pace of growth going forward may not be as brisk as it has been in the last few months, as recent activity may have been skewered by excessive froth following a harsh winter season.
“In markets with tight supply and strong demand, the strength of sales in recent months reflects how many properties were snapped up once they finally hit the market,” said Gregory Klump, CREA chief economist. “Because the impact of deferred listings and sales has likely run its course, activity over the second half of the year may not be able to maintain the kind of pace we’ve seen over the past couple of months.”