TORONTO (Reuters) - Sales of existing homes in Canada rose in June from May, notching the fifth straight monthly increase after a slow winter and taking sales to their highest level since March 2010, the Canadian Real Estate Association said on Tuesday.
The industry group for Canadian real estate agents said sales activity was up 0.8 percent last month after May’s robust 6.1 percent rise, suggesting the sharp bounceback after a harsh winter may be losing steam.
Canada’s housing market has roared back to life after an especially brutal winter hurt home building, sales and prices, but economists widely expect the market to slow again late in 2014 or in 2015 when interest rates begin to rise.
“With listings effectively unchanged and national sales much more moderate in June, the housing market may be losing some momentum as we head into the summer months,” Mazen Issa, senior Canada macro strategist at TD Securities, said in a research note.
“On an annual basis, we anticipate that sales will be nearly 4 percent higher relative to their 2013 level but we think that there is potential for a moderate unwind through 2015.”
Actual sales for June, not seasonally adjusted, were up a whopping 11.2 percent from June 2013.
The real estate association’s home price index rose 5.4 percent from June 2013, a slight acceleration from May’s 5.0 percent gain.
“In markets with tight supply and strong demand, the strength of sales in recent months reflects how many properties were snapped up once they finally hit the market (after the harsh winter),” association Chief Economist Gregory Klump said in the report.
“Because the impact of deferred listings and sales has likely run its course, activity over the second half of the year may not be able to maintain the kind of pace we’ve seen over the past couple of months.”
The national sales-to-new listings ratio was 53.6 percent in June, up slightly from 53.2 percent in May, as new listings edged lower.
There were six months of inventory at the end of June 2014, unchanged from May but half a month below where it stood at the beginning of 2014, CREA said.
The national average price for homes sold in June, not seasonally adjusted, was C$413,215 ($385,300), up 6.9 percent
from the same month last year. ($1 = 1.07 Canadian Dollars)
Reporting by Andrea Hopkins; Editing by Chizu Nomiyama and Jonathan Oatis