Brokers expect August home sales will steal the fall market’s thunder as buyers look to move before a rise in interest rates – a trend July’s booming numbers highlight.
“With everyone anticipating the inevitable interest hike, people want to lock in sooner than later,” said Steve Harrison, Dominion Lending Centres Mortgage Village. “Those who thought of buying in the fall may have done so now to pre-empt the increased rates.”
The Toronto real estate market enjoyed an unusually prosperous July, according to the Toronto Real Estate Board. Residential sales shot up by 16 percent over last year, with 8,455 keys changing hands – the most sales for the month of July since 2009.
The spike comes in spite of stricter lending regulations imposed by Finance Minister Jim Flaherty in July 2012.
“Despite recent increases in average borrowing costs, home buyers are still finding affordable home ownership options in the GTA,” said Toronto Real Estate Board President Dianne Usher in a statement.
No surprise to Yuval Fish with True North Mortgage: “July is usually the busiest month for real estate agents. July and August are busiest months because those who have a family don’t want to move during the school year.”
He anticipates the trend to continue into August, based on the current level of activity.
That’s “due to some of the offers made in July closing in August,” Fish told MortgageBrokerNews.ca.
“The negative press has over-estimated the negative climate of the market. It’s not happening even though they say it will (drop) eventually.”
The average housing price also jumped by 8 per cent over the prior year to $513,246, according to the Toronto Real Estate Board.
“What I noticed was the lack of inventory; the houses were going for more than they were for last year,” said Harrison. “With the lack of supply, the lack was even more, which pushed prices up.”