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Home prices across the greater Toronto area surged nearly 28 per cent in February from a year earlier, although a slower decline in listings than in sales indicated a “modest move to a slightly more balanced market,” the Toronto Regional Real Estate Board (TRREB) said on Thursday.

Total sales fell nearly 17 per cent measured by units, while new listings overall declined 6.6 per cent units, and condominiums offered for sale increased from a year ago.

Higher borrowing costs will have a “moderating effect” on home sales this year, with price growth easingin the second half of this year, although substantial immigration and a continued supply shortage are likely to have a countering effect, TRREB said.

“We have seen a slight balancing in the market so far this year, with sales dipping more than new listings,” TRREB Chief Market Analyst Jason Mercer said in a statement. “However, because inventory remains exceptionally low, it will take some time for the pace of price growth to slow.”

The Bank of Canada raised its benchmark interest rate to 0.50 per cent from a record-low 0.25 per cent on Wednesday and said they would need to go higher, hinting at a further increase next month.

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