Home sales across Canada dropped by 6 percent in May - the biggest monthly drop since 2012. The decrease has been driven by a plunge in the Greater Toronto Area (GTA) after the Ontario government placed a tax on international buyers.
The Canadian Real Estate Association (CREA) found that the number of residential properties sold nationwide fell by 6.2 per cent in May compared to April. This is the largest month-to-month decline in almost five years.
“This is the first full month of results since changes to Ontario housing policy made in late April. They provide clear evidence that the changes have resulted in more balanced housing markets throughout the Greater Golden Horseshoe region,” CREA chief economist Gregory Klump said in a statement.
“For housing markets in the region, May sales activity was down most in the GTA and Oakville. This suggests the changes have squelched speculative home purchases.”
Among several measures, the Ontario government imposed a 15 percent tax on foreign buyers, aimed at cooling Toronto’s red hot housing market.
CREA’s data revealed that while real estate may be local, the effects of changes in a market the size of Toronto can have a huge national impact.
Nationally, the average price for all homes sold last month was $530,304, boosted by Toronto and Vancouver, where it was $863,910 and $1,110,376, respectively.
Source: Canadian Business Magazine