The Globe and Mail reports in its Tuesday edition that Canadian home sales and prices had another month of double-digit increases in February, prompting economists to warn of an overheated market. The Globe's Rachelle Younglai writes that home sales were 39 per cent higher than in February of last year and the average home price was 25 per cent above last year at $678,091, with low mortgage rates, a desire for bigger properties and low inventory propelling the boom. The average selling price is set to hit $665,000, up 17 per cent from last year. The forecast for 2021 is significantly higher than the Realtor association's December prediction for annual sales of 584,000 and average selling price of $620,400. The association credited an increasingly middle-aged millennial cohort entering the housing market for the spike in demand. "Policy makers should be thinking about how to react, and soon before it gets dangerous," said Robert Kavcic, senior economist with Bank of Montreal. Mr. Kavcic said only a handful of measures are available to address what he calls a market that is "boiling," such as finding a way to curb speculative buying and blind bidding, where homebuyers do not know what their competitors are offering.
© 2021 Canjex Publishing Ltd. All rights reserved.