(Adds details from report, background; changes dateline,
By Leah Schnurr
OTTAWA Oct 14 Sales of existing Canadian homes
edged up in September after four months of declines, driven by
gains in the hot market of Toronto, while Vancouver continued to
cool following a tax on foreign home buyers.
The Canadian Real Estate Association said sales were up 0.8
percent last month from August, with regional markets split.
Sales rose in the Toronto region and fell further around the
lower mainland of British Columbia, extending a recent trend.
Low borrowing costs have propelled Canada's housing market
since the financial crisis, but surging prices in Toronto and
Vancouver have fueled concerns about a potential housing bubble.
In a bid to address affordability issues for residents,
British Columbia imposed a tax on foreign buyers in Vancouver in
Data has suggested that market was already slowing before
the tax, and Friday's report showed September sales were down
1.7 percent in Vancouver. Compared to a year ago, sales slumped
"We're continuing to see the B.C. markets, and Vancouver in
particular, cooling," said Robert Hogue, senior economist at
Royal Bank of Canada. "So we were concerned about overheating, I
think is being addressed."
In addition, Canada's Liberal government tightened mortgage
rules and closed a tax loophole on home sales earlier this month
in its latest bid to cool the market.
The federal measures will likely put further downward
pressure on resales, but what impact they have on prices will
depend on the region, said Hogue.
The first of the measures, stress tests for insured home
buyers, will come into effect on Monday.
CREA's chief economist, Gregory Klump, said first-time home
buyers, particularly those in expensive markets, may be priced
out by the new regulations.
In the Toronto region, sales were up 3.1 percent in
September. Nationally, actual sales, not seasonally adjusted,
were up 4.2 percent from a year ago.
National home prices slowed slightly, with CREA'S home price
index up 14.4 percent in September compared with the year
before. That was down from an annual 14.7 percent in August,
making for the first deceleration since March 2015.
Greater Vancouver was still one of the biggest gainers, up
28.2 percent, while the greater Toronto region climbed 18.0
percent. Though home prices in oil-sensitive Calgary have held
steady since May, they were down 4.1 percent compared to a year
(Additional reporting by Jeffrey Hodgson in Toronto; Editing by