Home sales fall in February as prices edge up

OTTAWA — Greater Toronto Area home sales fell in February from January, snapping two straight months of gains, while prices increased, keeping a housing market resurgence in check amid high borrowing costs, data showed on Tuesday.

Seasonally adjusted month-on-month sales declined 12 per cent in February, after a 12.6 per cent rise in the month earlier, according to Toronto Regional Real Estate Board (TRREB) data. Average home prices increased 1.3 per cent to $1.08 million in the month, while new listings were essentially unchanged from January.

Home sales in Canada have started to revive in recent months in anticipation of interest rate cuts by the central bank.

While TRREB did not provide an explanation on the fall in sales volumes, it said monthly figures could be volatile, especially when the market is approaching a transition point.

The Bank of Canada has kept its key policy rate on hold at five per cent since July, and money markets and economists expect its next move will be a rate cut.

“As we move through 2024, an increasing number of buyers will re-enter the market with adjusted housing preferences to account for higher borrowing costs,” TRREB chief market analyst Jason Mercer said.

“In the second half of the year, lower interest rates will further boost demand for ownership housing,” Mercer said.

On an annual basis, home sales increased 17.9 per cent in February, slower than the 37 per cent year-over-year rise recorded in January.

The sales rise was outpaced by an annual 33.5 per cent jump in new listings, pointing to increased choice for buyers, TRREB said.