TORONTO (Reuters) - Sales of existing homes in Canada fell in June from May as a decline in sales in Ottawa and Montreal outweighed increases in the Toronto area, but national prices continued to rise, the Canadian Real Estate Association said on Wednesday.
The industry group for Canadian real estate agents said sales activity was down 0.8 percent last month from May, but noted that sales levels in May and June were at the strongest level in more than five years.
Actual sales for June, not seasonally adjusted, surged 11 percent from June 2014.
“After a tough winter across many parts of the country, homebuyers were very active through the spring and early summer, with record low mortgage rates providing a boost,” Robert Kavcic, senior economist at BMO Capital Markets, said in a research note.
“Overall, the market didn’t tighten up again in June, but it is quite a bit tighter than it was a year ago.”
CREA’s resale home price index rose 5.43 percent from June 2014.
Vancouver and Toronto continued to set the pace with year-over-year price increases of 10.26 percent and 8.94 percent, respectively, while gains in the oil-industry capital of Calgary eked out a year-over-year increase of 0.48 percent, CREA said.
Financial authorities have spoken of a three-speed housing market, with Toronto and Vancouver sizzling, Canada’s energy-producing heartland of Alberta and Saskatchewan suffering due to low oil prices, and the rest of the country relatively stagnant.
Canada’s housing market has climbed unsteadily higher in the six years since the global financial crisis despite warnings from economists that a plateau, slowdown, or a crash loomed.
CREA said the national sales-to-new listings ratio was 57.2 percent in June, little changed from May but up from a low of 50.4 per cent in January. A ratio between 40 and 60 percent is considered balanced territory, and CREA noted that the ratio has risen steadily along with sales over the first half of the year while new supply has remained stable.
CREA said the number of months of inventory was unchanged at 5.6 months, remaining at the lowest reading in three years.
The national average price for homes sold in June 2015 was C$453,560 ($354,620.80) up 9.6 percent year-over-year, the report showed.
Reporting by Andrea Hopkins; Editing by Chizu Nomiyama and W Simon