BY: Leah Schnurr
OTTAWA: Toronto home sales tumbled in June, while more owners put their properties up for sale as they worried a rapid acceleration in prices had peaked following measures by the provincial government to rein in the market, data showed on Thursday.
Sales in Canada’s largest city fell 37.3 percent last month compared to a year ago, the Toronto Real Estate Board (TREB) said in a report.
At the same time, new listings rose 15.9 percent from last year, though that was a slowdown from the hefty 48.9 percent annual increase in listings in May.
The Ontario government introduced a number of measures in late April, including a foreign buyers tax, to try to cool the housing market in Toronto and the surrounding areas amid fears of a bubble.
“We are in a period of flux that often follows major government policy announcements pointed at the housing market,” the real estate board’s president Tim Syrianos said in a statement.
While potential buyers are waiting on the sidelines to gauge the impact of the government’s measures, existing owners are listing their homes because they believe price increases may have peaked, Syrianos said.
The average home price in June was C$793,915 ($611,880.54), up just 6.3 percent from last year. The average selling price in May had risen 14.9 percent from a year earlier.
The slowdown in the pace of price growth was partly due to increased supply on the market, though a decline in sales of more expensive homes was also a factor, TREB said.
The adjustment in the Toronto market comes as the Bank of Canada has set the stage for interest rate increases as soon as next week. Some experts have said low rates have encouraged consumers to take on too much debt and fuelled the housing market.
Taking the provincial government’s recent measures and the possibility of higher rates into account, TREB forecast sales this year at between 89,000 and 100,000 homes, down from a record 113,044 homes in 2016. ($1 = 1.2975 Canadian dollars)
(Editing by Meredith Mazzilli)
Source: Reuters