Home sales across Canada fell 1.6% in August from July, marking the sixth consecutive
monthly decline, according to the Canadian Real Estate Association (CREA).
The slowdown in home sales was uneven across the country, with a rise in the Greater Toronto
Area (GTA) offset by declines in Vancouver, Calgary, Edmonton, Winnipeg, and Halifax.
However, despite the monthly drop, home sales in August were up 7.1% from the same month a
year ago.
CREA blamed the monthly downturn on rising interest rates that are leading to higher rates on
home mortgages and pushing potential buyers to the sidelines.
The cost of borrowing has been on the rise as the Bank of Canada increases its trendsetting
interest rate from a low of 0.25% to its current level of 3.25%. The central bank is raising interest
rates to lower inflation that is running at a 40-year high of 7.6%.
Higher interest rates are increasing mortgage qualifying rates to their highest level in nearly 20
years, with financial stress tests now requiring that potential homeowners can manage a
mortgage rate of 7%.
