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Canadian home sales rebound from 7-year low, but prices are still steady

After plunging to the lowest level since 2012, home sales in Canada have increased in the last two months and are about 4% higher than a year ago.

The Canadian Real Estate Association said on Wednesday that home sales last month rose annually for the first time since December 2017.

This was the last month before the federal government tightened mortgage rules by implementing a "stress test" on borrowers, making it more difficult to get financing to buy a home. The rules were introduced to stifle speculators and over-leveraged buyers, and the result so far has been to let out much of the hot air on the market.

Sales plummeted and prices ended up interrupting the series of further increases of several years, month after month. On the price side, the average selling price of a Canadian home fell every month since September last year when the value was $ 487,000.

CREA reported Wednesday that the average price of a Canadian reseller home sold in April was $ 495,000, an increase of 0.3% over the same period last year.

The group representing 130,000 real estate agents across the country says an increase in sales activity in the Toronto and Montreal areas was enough to offset the decline in Vancouver.

"Sales are still falling, with buyers adjusting to a cocktail of affordability issues, reducing access to funding due to mortgage stress testing and changes in housing policies implemented by the British Columbia provincial government," said Gregory Klump, chief economist at CREA. .

Despite the nationwide increase in sales, the number of homes sold is still below the level it was in almost the entire second half of last year.

"Housing market trends are improving in some places and not so much in others," said CREA chairman Jason Stephen.

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