April Home Sales Set Record: Toronto Real Estate Board   By Meghan Potkins May 5, 2010  

April was a record month for home sales in the GTA the Toronto Real Estate Board said in a monthly report released today.

Buyers attracted by historically low interest rates have propelled a rebound of the housing market in recent months, with the number of housing sales much higher than expected. The average price reached $437,600, up 13% from the average of $385,641 in April 2009.

The board reported the sale of 10,898 residential properties in April — a 34% increase compared to April 2009. On the supply side, April saw a 59% annual increase in new listings with 20, 683 homes listed.

An analyst with the Toronto Real Estate Board said homeowners are beginning to take notice of the hot prices and are rushing to take advantage while demand is high. Jason Mercer, a senior market analyst with the Toronto Real Estate Board, said the record numbers will not be sustained in the second half of 2010:

“Home sales will remain strong in the second half of 2010, but will slip from the current record pace as borrowing costs rise.”

Record Home Prices and Sales Set in April   National Post Friday, May 07, 2010

Toronto homebuyers, attracted by historically low interest rates, set a record in April for prices and sales.

The Toronto Real Estate Board this week reported the sale of 10,898 residential properties in April - a 34% increase from April 2009 to hit a record month, according to the Toronto Real Estate Board's monthly report. The average home price was $437,600, up 13% from a year earlier. On the supply side, April had a 59% annual increase in new listings, with 20,683 homes listed, a hike that will help balance the market.

Jason Mercer, TREB's senior manager of market analysis, said "Home sales continue to be driven by many different segments of the market, with sales growth for all major home types" in the 416 and 905. TD Bank said home sales will drop off in the second half of this year and the next - with current levels of home construction stronger than expected, the added supply will soon begin to drive down prices.

Rising but Still Historically Low Interest Rates   By Benjamin Tal

The Bank of Canada is unlikely to raise rates much while the US Federal Funds Rate stays near zero. Doing so could result in premature slowing of our economy and an even higher Canadian dollar. We therefore expect the first wave of rate hikes to be limited, with most of the increase in 2011 when the Fed starts moving.

It’s clear that the Bank of Canada will begin moving by June or July. We expect the overnight rate to rise from its current 0.25% to 1.25% by the end of this year. By the of 2011, the rate should still be a historically low 2.5%-3%.

Can We Expect Interest Rate Hikes from BOC?   Source: CalgaryHerald

With both inflation and retail sales stronger than expected, many are wondering what the Bank of Canada’s next move will be.

Figures from Statistics Canada on Friday showed the annual inflation rate, driven by gains in energy prices, rose to 1.8 per cent in April compared with a 1.4 per cent rise in March. Retail sales also soared 2.1 per cent during the month, compared to an upwardly revised 0.8 per cent increase in February. March marked the fourth straight monthly gain, and was the biggest rise in more than five years.

It seems as if all signs point to an increase in the Bank of Canada's key interest rate, currently sitting at a record low 0.25 per cent. Analysts have been forecasting a rate hike was all but certain since the central bank scrapped its pledge to hold them at 0.25 per cent on April 20.

We cannot ignore however, the European debt crisis, which is certain to play a role in the Bank of Canada's decision. Which have many wondering whether a June 1 rate hike is in our future? Let’s wait and see!

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