PropertyWire.ca
Building on the momentum from the end of 2010, 2011 started off strongly in the Canadian property resale market, according to the newest report released by CREA.
This spike in numbers does not come as any major surprise, given the introduction of the new mortgage lending restrictions. Buyers, it seems, are hurrying to beat the deadline for when these measures will be fully enacted- in spring 2011.
Reaching levels not seen since last spring, across the country, seasonally adjusted home sales activity went up by 4.5 % in January 2011 over December’s numbers. Vancouver and Toronto topped the list for seasonally adjusted sales activity.
Additionally, monthly gains were realized in more than half of all local Canadian markets in January. According to the report,”National sales activity has improved steadily since last summer, and now stands almost 25 per cent above the low point reached in July 2010.”
“We anticipated the recent announcement of tighter mortgage regulations, which will come into effect this March, would pull forward sales activity into the first quarter of 2011, particularly in some of Canada’s more expensive housing markets,” said Gregory Klump, CREA’s Chief Economist. “The sharp rise in sales activity in Toronto following the announcement provides early evidence confirming this,” said Klump.
It will take some time before the longer term impact of the latest mortgage regulations on the housing market can be known,” said Georges Pahud, CREA’s President. “For that reason, further action shouldn’t be taken until the impact can be measured. In the meantime, if last year can be used as any guide, sales activity may heat up further as we get closer to the date on which tighter mortgage regulations come into effect, especially in some of Canada’s pricier markets. That said, local housing market trends often diverge from national trends, so buyers and sellers should consult their local REALTOR® to understand how the market is shaping up where they live.”
Balance is the word best associated with the current sales environment. In January, the housing market began to see signs of improved stability- balanced out by matched numbers of sales activity numbers and levels of inventory.
At the lowest levels seen since last March, the seasonally adjusted number of months of inventory remained stable at 5.5 months at the end of January, nationally- which is another indicator of balance.
In terms of average prices, upwards of two-thirds of local markets reported gains from this time last year. The national average price for homes sold in January 2011 was $343,675. This price is similar to those seen in the three months prior, but signals a rise of 4.5 % compared to January 2010.
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