Figures released this morning showed a sizable drop in home sales in this country last month.
The average price of a Canadian home inched 1.1% higher to $355,777 in September, even as the number of homes sold fell sharply.
The Canadian Real Estate Association's monthly sales data released Monday show the volume of home sales across the country was 15.1% lower in September 2012 compared to the same month a year earlier.
More than half of all local markets posted declines of at least 10% CREA said.
In July, the federal government capped the maximum length for an insured mortgage at 25 years, making it harder to qualify for a mortgage and likely to squeeze new buyers out of the market and let the air out of price gains.
That's exactly what's happening, CREA says.
At various times over the past 18 months, CREA has warned that the national average price has been artificially skewed higher or lower because of activity in Canada's two largest housing markets — Toronto and Vancouver.
That was once again the case in September, as CREA said fewer sales in Greater Vancouver this year compared to much stronger levels last year dragged the average lower.
The Vancouver market currently represents about 5% of all home sales in the country.
If Vancouver is stripped out of the equation, the national average would have shown a year-over-year increase of 3.4%.
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