Canada Housing Resales Fall 9.5%, Realtor Group Says (Update1) – BusinessWeek – #Toronto #realestate

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Canada Housing Resales Fall 9.5%, Realtor Group Says (Update1)

June 16, 2010, 12:37 PM EDT

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(Updates with value of home sales in second paragraph, new mortgage regulations in fourth paragraph.)

By Theophilos Argitis

June 16 (Bloomberg) — Canadian existing home sales fell 9.5 percent in May on a seasonally adjusted basis as the country’s housing market cools, a realtor group said.

The number of homes sold dropped to 37,576 units, from 41,502 units in April, the Canadian Real Estate Association said in a statement from Ottawa today. The value of home sales dropped 10 percent to C$12.8 billion ($12.5 billion), it said.

The realtor group cited changes in mortgage regulations that toughened qualifications for government insurance and rising mortgage rates that prompted many buyers to bring forward purchases of homes.

“May was the first full month in which sales activity was affected by these changes,” Georges Pahud, the association’s president, said in the statement. “An accompanying decline in new listings and housing starts means these changes are also affecting the supply side, which will keep the market balanced and Canadian home prices stable.”

Finance Minister Jim Flaherty tightened rules in the country’s mortgage market Feb. 16 to ensure buyers can afford their homes if interest rates rise. Under the changes for mortgages eligible for government insurance, which took effect April 19, buyers will have to meet standards for five-year, fixed-rate mortgages even if they opt for variable rates. Limits on refinancing will be stricter and people buying a home that they don’t occupy must make a down payment of 20 percent.

The Bank of Canada earlier this month became the first Group of Seven central bank to raise interest rates, doubling its benchmark rate to 0.5 percent.

New listings fell 4 percent to 76,201 units in May, the realtor group said. The average price for a home in Canada was C$346,881 in May, an increase of 8.5 percent from a year earlier.

–Editors: Paul Badertscher, David Scanlan

To contact the reporter on this story: Theophilos Argitis in Ottawa at targitis@bloomberg.net.

To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net; David Scanlan at dscanlan@bloomberg.net.

Posted via web from Toronto Real Estate News, Blog

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Dear Readers, I am a dedicated Toronto, Ontario based real estate professional who has been successfully meeting and exceeding the needs of his clients for past several years. I am actively involved in the insurance, financing, and mortgage industry. Real estate is not only my career – it is my passion. I strive to continuously provide my clients with exceptional service to ensure they are fully satisfied when it comes to their real estate needs. For any real estate related inquires contact me today, I will be happy to assist you. Best wishes, Tariq Sultan

One Response to Canada Housing Resales Fall 9.5%, Realtor Group Says (Update1) – BusinessWeek – #Toronto #realestate

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