Greater city area sees huge gains from a year ago
Canada's resale home sales sizzled in August, led by Greater Vancouver's 117-per-cent gain from a year ago, the Canadian Real Estate Association said yesterday.
Across the country, 42,483 homes changed hands in August, an 18.5-per-cent gain from a year ago, the association said.
Economists warned, however, that the market's performance in recent months is not likely to be repeated as home prices rise and the market consolidates gains.
On a month-to-month basis, in fact, national homes sales dipped slightly to 42,426 units in August from 42,666 in July.
"Canada's housing market has taken its cue more from the Great Houdini than the bear [economist Noriel] Roubini, fully escaping from the clutches of a potentially lengthy, harsh downturn,"said BMO Capital Markets deputy chief economist Doug Porter.
"Record-low borrowing costs, combined with the growing realization that the economic storm is passing, have fuelled the remarkable turnaround.
"However, the gaudy sales growth will be tough to maintain now that prices are moving higher again."
Resale activity rose from year-ago levels in about three-quarters of local markets.
Toronto's year-over-year sales rose 27 per cent, Calgary's 17 per cent and Montreal's nine per cent.
August marks the third consecutive month in which year-over-year sales rose by more than 15 per cent, CREA said.
Greater Vancouver remains Canada's most expensive market. Year-over-year average prices in the area climbed 9.1 per cent to $608,032.
Victoria, the country's second priciest market, climbed 6.4 per cent to $481,279.
The national average price rose 11.3 per cent from a year ago to $324,779 in August, CREA said.
A market-weighted average shows a more modest 5.3-per-cent year-over-year rise in average prices.
"On balance, given the recent unbelievable strength in the
Canadian housing market, the modest [month-to-month] down-shift in sales in August should not be seen as anything other than a brief respite in what has been a remarkable recovery in the sector," said TD Securities economics strategist Millan Mulraine.
"Even so, we believe that Canadian housing market activity in the coming months will be relatively tepid as the sector consolidates the gains made since January."