UPDATE 1-Canadian existing home sales declined for 5th month in January

Fri Feb 14, 2014 10:43am EST
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By Leah Schnurr

TORONTO Feb 14 (Reuters) - Sales of existing homes in Canada fell in January for the fifth month in a row as unusually harsh winter weather discouraged potential house hunters, the Canadian Real Estate Association (CREA) said on Friday.

Sales activity was down 3.3 percent last month from December, data from the industry group for Canadian real estate agents showed.

Activity was 9.1 percent below 2013's peak hit in August, CREA said. Sales were down on a monthly basis in more than 60 percent of all local markets last month, including declines in the greater Toronto and Vancouver areas.

The frigid temperatures brought on by the so-called "polar vortex" dented both resale activity and new construction in January as prospective buyers deferred home purchases, the report said.

"A number of buyers likely waited out January's deep freeze before going house hunting," CREA President Laura Leyser said in a statement.

Nonetheless, the report underscored the view that Canada's housing market, which boomed coming out of the recession but cooled after the federal government tightened mortgage rules, should be softer but relatively stable this year as borrowing costs rise.

"While weather may have constrained sales activity in January, the slowdown is more emblematic of the broader theme of a soft landing in the existing home sales market," said Mazen Issa, senior Canada macro strategist at TD Securities in Toronto.   Continued...