Home sales pace hits 9-month high

Home sales in Canada increased 4.5 per cent in January over the previous month, their highest seasonally adjusted point since last April.

The Canadian Real Estate Association said Tuesday the Vancouver and Toronto markets led the way, but there were gains in more than half of all local markets during the month.

"We anticipated the recent announcement of tighter mortgage regulations, which will come into effect this March, would pull forward sales activity into the first quarter of 2011, particularly in some of Canada’s more expensive housing markets," CREA chief economist Gregory Klump said.

"The sharp rise in sales activity in Toronto following the announcement provides early evidence confirming this."

Klump was referring to Finance Minister Jim Flaherty's announcement in January that Ottawa will no longer insure mortgages of longer than 30 years.

National sales activity has improved steadily since last summer, and now stands almost 25 per cent above the low point reached in July 2010, CREA said.

The national average price for homes sold in January was $343,675. While little changed compared to the previous three months, much like the total sales numbers, the price figure is 4.5 per cent higher than the average price level in January 2010.

New listings of homes for sale normally post their biggest month-over-month increase in January, and January 2011 was no exception.

New listings more than doubled in January compared to the previous month, the largest such gain since 2007.