New, tighter mortgage rules appeared to push home sales off the proverbial cliff September, the overall number falling 15 per cent from a year ago, according to a new report from CREA.
“New mortgage rules continue to keep a lid on national sales activity,” said Wayne Moen, president of the Canadian Real Estate Association said Monday in releasing the number of homes sold across all major Canadian markets last month. “That said, national figures mask diverging trends in different markets, with activity down in some places while sales elsewhere remain strong.”
The aggregate picture is easier to read.
• Actual (not seasonally adjusted) activity down 15.1% from September 2011.
• Number of newly listed homes up 6.5% from August to September.
• Home sales up 2.5% from August to September.
That last percentage climb marks the first monthly gain in activity since March 2012, said CREA, and represents a partial recovery from the 6.2 per cent drop recorded in August in the wake of the new mortgage rules.
Activity picked up in about 60 per cent of local markets in September, including Greater Vancouver, Calgary, Edmonton, Greater Toronto, and Quebec City.
Still, a downward trend is evident.
“National activity is likely to remain down from year-ago levels over the fourth quarter of 2012,” said Gregory Klump, CREA’s chief economist. “While some first time home buyers may no longer qualify for mortgage financing under the new rules, it is likely that many others are stepping back and reassessing how much house they can realistically afford, which is one of the things new mortgage rules were designed to do.”
National sales reached 110,376 units in the third quarter of 2012, down 6.5 per cent from the previous quarter. A total of 366,353 homes have traded hands over Canadian MLS® Systems so far this year, up one per cent from levels reported over the first nine months of 2011.