canadian house prices still growing as govt works hard to apply brakes
News Posted On: 11 June 2010
Canadian property prices are still rising! According to the government's statistics office, new home prices rose for the 10th consecutive month in April, with a gain of 0.2% matching the previous month's growth.
The data released by Statistics Canada shows prices up in 11 of 21 metropolitan areas, down in 4 and unchanged in 6.
St. John's, Newfoundland and Labrador all saw prices grow by 1.1%, the largest growth recorded. House builders in all three cities said rising material and labour costs were key factors in the price increases, the Canadian Broadcasting Corp. reported.
Regina and Saskatoon, both in Saskatchewan, followed at 0.9 percent. Charlottetown, Prince Edward Island, and Sudbury and Thunder Bay, Ontario, each posted 0.3 percent monthly decline, the largest decrease in the country, Statistics Canada said.
The latest rise means that Canadian house prices are now 2.5 percent higher than last year, continuing from March when prices were 1.6% up on a year ago. In Vancouver prices are now 6% higher than a year ago according to the figures.
The government is currently trying to put the brakes on growth. From July first the goods and services tax and provincial sales tax will be merged into a single sales tax in Ontario and British Columbia. Analysts expect this to dampen the housing markets in those cities.
On top of that the Bank of Canada has finally raised its key interest rate, following suit with other countries seeing runaway property market growth. There is worry that Canadians have been over-stretching themselves, so the interest rate rise is most definitely a good thing in that respect.
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