The latest Teranet
house price index revealed that February saw a record-high number of real estate transactions in Toronto, with Vancouver experiencing “the tightest home resale market in 12 years.”
According to the National Bank
, these developments have come about in spite of recent regulatory changes that have been intended to cool down the national housing market. The new rules ask for higher down payments on homes valued above $500,000.
The price spikes are expected to last throughout most of the year, said National Bank economist Marc Pinsonneault. He noted that the revised rules do not apply to those who bought homes before February 15, who have until July 1 to finalize their purchases.
“So sales in these expensive cities can be stimulated over the coming months as well,” Pinsonneault stated in his report, as quoted by HuffPost Business Canada
However, the National Bank emphasized that while house prices nationwide increased by an average of 6.5 per cent over the past year, this rise can be attributed solely to the red-hot performance of the most active cities.
“The last monthly increase in the composite index, the largest for a month of February since the recession, is totally due to the price jump in Vancouver,” Pinsonneault said.
Elsewhere in the country, real estate prices plunged in five other major cities—namely, Calgary, Edmonton, Halifax, Montreal, and Ottawa. The economy’s slow recovery from the oil shock would make Vancouver and Toronto the tent-poles of the Canadian housing sector for some time to come, the National Bank added.