TORONTO: Canadian home sales pulled back in February after strong growth in the previous two months, but prices stopped falling in a potential sign that a revival in the market is underway ahead of anticipated interest rate cuts by the Bank of Canada.
Canadian home sales fell 3.1 per cent in February from January, giving back some of the cumulative 12.7 per cent increase posted in the previous two months, data from the Canadian Real Estate Association showed on Monday. Sales were up 19.7 per cent on an annual basis.
"It's looking like February may end up being the last relatively uneventful month of the year as far as the 2024 housing story goes," Shaun Cathcart, CREA's senior economist, said in a statement.
"With so much demand having piled up on the sidelines, the story will likely be less about the exact timing of interest rate cuts and more about how many homes come up for sale this year."
Money markets expect the Canadian central bank to begin an interest rate cutting campaign in June or July. The BoC has kept borrowing costs on hold at a 22-year high of 5.0 per cent since July last year.
The industry group's Home Price Index was flat on the month following five straight months of declines. It was up 0.8 per cent annually, while the national average selling price was up 3.5 per cent on the year.