Canadian resale home prices flat in March - Teranet

Mon Apr 14, 2014 9:55am EDT
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By Andrea Hopkins

TORONTO (Reuters) - Canadian resale home prices were flat in March from February and 12-month home price inflation slowed slightly, the Teranet-National Bank Composite House Price Index showed on Monday.

While national prices were essentially unchanged last month from February, the index, which measures price changes for repeat sales of single-family homes, showed regional disparities, as Calgary roared ahead but Montreal faltered. The Teranet report does not provide actual prices.

"Except for the recession year 2009, this is the first time in 15 years of index data collection that home prices for Canada as a whole have failed to advance in March," Teranet said in the report.

From a year earlier, prices were up 4.6 percent, a slowing from February's 5.0 percent price gain. It was the first time in nine months that 12-month inflation has slowed.

Canada's housing market, which has boomed unsteadily for about five years, slowed at the end of 2013 and observers have been watching to see whether homebuyers will storm back in as the spring buying season begins.

"With the spring season underway, we are likely to observe a typical bounce in housing activity so prices will likely remain buoyed over the next few months," Mazen Issa, senior Canada macro strategist at TD Securities, said in a research note.

"This will be short-lived, however, as the underlying fundamentals point to a soft landing in the housing market."

Canada escaped the U.S. housing crash that accompanied the 2008-09 financial crisis, and home prices have risen sharply, if not steadily, in the past five years despite moves by the federal government to tighten mortgage lending rules.   Continued...

A "Sold" sign hangs in front of a house in Toronto, Ontario March 2, 2014. REUTERS/Hyungwon Kang