The Canadian Real Estate Association (CREA) released sales data for February showing a sharp increase of 26.9% when compared to February 2019. This year did include an extra day for the leap-year, but the CREA reported that sales topped year-ago levels in about 80% of all local markets, including all the large urban markets across the country.

On a month-over-month basis, sales in February were up 5.9%, boosted by a 15%  jump in the Greater Toronto Area. The number of newly listed homes rose 7.3% per cent in February compared with January.

The increase in sales also matched an increase in house prices according to data from the Teranet-National Bank Composite House Price Index. Prices climbed 0.4% in February and seven of the 11 metropolitan areas in the index showed gains, with Montreal rising 1.1% and Vancouver up 0.8%. When compared to February 2019, the index climbed 2.9%. 

However, the situation is constantly changing due to COVID-19. Mortgage rates have fallen in recent days in the wake of rate cuts by the Bank of Canada. On March 16, Canada’s biggest banks said they would reduce their prime rates by 50 basis points to 2.95%, the lowest level since August 2017, fully passing on to borrowers the Bank of Canada’s second interest rate cut this month. 

TD Bank senior economist Brian DePratto has said that he expects the market to slow substantially in the near-term, if not retrench due to COVID-19. However he believes that, … “sales are well-positioned to make a strong recovery once the impact of the virus dissipates, helped by an ultra-low interest rate environment,” DePratto wrote in a report.

Source: The Star
Source: Globe & Mail