Home sales barely budged in October, dipping 0.1 per cent from September’s level, the Canadian Real Estate Association said Thursday.
At the same time the growth in prices of existing homes has slowed markedly.
Sales fell significantly in August and have not shown a large rebound since, a phenomenon that real estate industry players attribute to the government’s decision to tighten the mortgage rules in July, although senior officials in Ottawa have suggested that it’s too soon to determine what impact the rule changes had.
When he tightened the market, Finance Minister Jim Flaherty was seeking to take some steam out of growing consumer debt levels and house prices.
The growth in prices is slowing, a development that economists say is healthy. A gradual softening is better than a crash, they argue.
The national average price of homes that were sold in October was $361,516, an increase of just $80 or 0.02 per cent compared to the average selling price a year earlier. But factoring out Vancouver and Toronto, the average selling price rose 2.5 per cent.
The Canadian Real Estate Association’s MLS home price index, which seeks to account for any change in the types of houses that are being sold, rose 3.6 per cent from a year ago. That’s the slowest rate of increase since May 2011, and marks the sixth month in a row that price gains have been shrinking.
Thursday’s figures suggest that while sales have been lower in the second half of the year, the annual total is still on par with 2011. A total of 402,322 homes have traded hands over the Multiple Listing Service in the first ten months of this year, up 0.8 per cent from the same period last year.
The number of homes sold in October is down 0.8 per cent from last October. September’s figures had been 15.1 per cent lower than a year ago, and August’s 8.9 per cent lower than a year ago.
The national figures were affected by slower year-over-year sales in Toronto, Vancouver and Montreal. But sales were up from last year in almost two-thirds of the country’s local markets, led by Calgary, the real estate association said.