Victorian House by Neil Kremer
Sales activity decreased by 14.7% from April 2010, and the national average home price was $372,544 in April 2011 — a year-to-year growth of 8% — according to the new release of the Canadian Real Estate Association (CREA).
The average price has been skewed due to a number of multimillion-dollar sales in Vancouver. “When you take Vancouver out of the equation, the year-over-year increase in the national average price drops to 3.4%,” said CREA’s senior economist, Gregory Klump. According to CREA’s newest forecast, prices will increase by about 4% this year.
Sales activity eased in almost two thirds of all local markets from the previous month, offsetting the huge gains in Calgary and Vancouver. The national housing market moved further into balance due to a decrease in sales and an increase in newly listed homes that edged up 1.3 per cent in April from March, but stayed below the numbers in January and February. The national sales-to-new-listings ratio, measuring the market balance, was 52.5% in April — a decline from 55.7% in March.
The mortgage regulations that came into effect in February have contributed the most to April’s sales decline. CBA news explained: “New mortgage rules will make the maximum payback period 30 years — resulting in somewhat higher regular payments than with the 35-year amortization that has been the choice of about 30% of home buyers.” CREA expects the rules will reduce prices starting next month.