March home sales volume plunges 22.7%, national average price down 10.4%: CREA
TORONTO — The most-affordable segments of Canada’s housing market are seeing the biggest price hikes as recent changes to mortgage regulations fuel demand for lower-priced homes such as condominiums, according to the country’s real estate industry organization.
The tighter mortgage lending rules, which make it harder for home buyers to qualify for uninsured mortgages, are also shrinking the pool of qualified buyers for higher-priced homes, said Gregory Klump, chief economist of the Canadian Real Estate Association.
“Given their limited supply, the shift of demand into lower price segments is causing those sale prices to climb,” he said in a statement as the association released its latest figures for the month of March. “As a result, ‘affordably priced’ homes are becoming less affordable while mortgage financing for higher priced homes remains out of reach of many aspiring move-up home buyers.”
Home sales across the country have dropped in the wake of several government policy measures, including a stress test for home buyers with a down payment of more than 20 per cent, that were implemented to cool the country’s hot housing market. Last March, national home sales activity had reached an all-time record for that month, according to CREA.