|
Across the country, the Canadian Real Estate Association (CREA) said
Friday, December sales increased 72 per cent from the same month in
2008, to 46,805 units, while prices gained 19 per cent to an average
$337,410.
The record month capped the strongest quarter ever recorded – sales increased 59 per cent over the previous year.
The national average price climbed 5 per cent in 2009, to a record $320,333.
“It is simply amazing to think that we saw any increase in prices at
all in the teeth of one of the worst recessions Canada,” said Douglas
Porter, deputy chief economist with BMO Nesbitt Burns. “That is not
something anyone was predicting. While I think it's a little premature,
the formation of a bubble is something we should be discussing.”
The Bank of Canada
whose overnight lending rate helps determine mortgage rates, took the
unusual measure of delivering a speech on the topic earlier this month,
declaring it “premature” to talk about the formation of an asset bubble
and dispelling any notion of its intervention to cool the market down.
CREA also brushed aside any suggestions of an overheated market yesterday as it released the data.
“Cooler heads recognize that many of the recent gains reflect
temporary factors that could fade by summer,” said chief economist
Gregory Klump.
New listings posted a year-over-year gain in December for the first
time in a year, with 33,090 properties made available. Along with
interest rates that are expected to be higher by the second half of the
year, he said the market should find its balance.
“A more balanced market will result in smaller price increases in
the second half of the year,” he said. “By the second half of 2010,
price gains are likely to shrink significantly, since a year will have
elapsed since the decline and rebound.”
|
