As reported in The Globe and Mail, policy makers in Ottawa have been taking some comfort from signs Canadian home prices have been moderating lately. They shouldn’t.
If Toronto-Dominion Bank economist Diana Petramala is correct, home prices might be on their way up again. That would be disappointing news to those in Ottawa who, until recently, were fairly certain they had successfully steered the housing market toward a soft landing. Under that scenario house prices were supposed to slowly lose some steam, rather than go through a major correction. Most economists agree that home prices are inflated, and, coupled with high consumer debt levels, pose a risk to the economy.
The Canadian Real Estate Association, which represents realtors and tracks the market by way of the MLS, released data Monday that showed that the number of newly listed homes fell 1.2 per cent from July to August. “Led by Greater Toronto, new supply was down in about 60 per cent of local markets,” CREA said.
“The number of homes for sale have not kept up with demand and the market moved more in favour of sellers,” Ms. Petramala wrote in a research note. “We continue to be surprised by the lack of listings on the market. The sales-to-listings ratio has moved back to the level reached at the end of last year, when prices were growing 8 per cent to 9 per cent year-over-year. This suggests that following four months of moderation, home-price growth may catch a second wind through the fall months.”
In Durham Region the home price growth continued in August. There were 919 sales in August 2014, down 3.8 per cent compared to 955 sales in August 2013. "However, year-to-date, Durham Region has seen 7,704 sales, up 3.7 per cent compared to 7,430 over the same period last year" explained Durham Region Association of REALTORS® (DRAR) President Jane Hurst.
The average price of resale homes in Durham Region in the month of August was $388,690. "August's average price is 7.7 per cent higher than August of last year" stated Hurst. The number of new listings that entered the market in August was 1,209, down 9.4 per cent from 1,323 in August 2013. Listings have decreased and prices have increased over the past year.
Hurst stated that so far this year, prices grow, sales remain steady and listings decrease in comparison to last year.
Sources:
- The Globe and Mail. http://www.theglobeandmail.com/report-on-business/economy/housing/data-show-home-prices-will-continue-to-rise/article20609979/
- Durham Region Association of Realtors. http://www.durhamrealestate.org/blogEntry.cfm?b=7242
To learn more about local market conditions, or insight into prices for real estate in Whitby, Brooklin or other areas within Durham Region, please contact me.
Randy Miller
Broker
Re/Max Rouge River Realty Ltd., Brokerage
905-668-1800 or 905-427-1400
randy@randymiller.ca
http://whitbybrooklinhomes.com/randy@randymiller.ca
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