Canada: 6.7% reduction in Canadian home sales

Sales of homes across Canada fell by 6.7% between May and June, the greatest reduction in 7 years. Actual sales were down 11.4% compared to this time last year.

Greater Toronto saw a larger 15.1% drop, and according to the Canadian Real Estate Association (CREA), this is the primary driver of the national sales slump. Sales have reduced as the Ontario government has adopted measures such as taxing foreign buyers at a rate of 15%, and nationally the number of new homes listed fell by 1.5% in June compared to May.

Gregory Klump, Chief Economist at the CREA, stated: “The recent increase in interest rates could reinforce a lack of urgency to purchase or, alternatively, move some buyers off the sidelines before their pre-approved mortgage rate expires. In the meantime, some move-up buyers who previously purchased a home before first selling may become more motivated to reduce their asking price rather than carry two mortgages.”

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