OPINION: The Composite Index relapsed in February, having lost ground in four of the last six months, for a cumulative drop of 1.9%. Moreover, over that period, indices declined in seven metropolitan regions out of 10. Excluding Vancouver, the Composite Index would have declined or stayed put in each of the last six months. Speaking of Vancouver, we estimate that home sales declined markedly in February. Therefore home price pressures may fade out in that area over the next few months, even if for the moment the home resale market remains tight. For Toronto, home sales declined in January and February after a rush in Q4. In February, we estimate that sales were at their lowest seasonally adjusted level since July 2010, with the active-listings-to-sales ratio indicating a 3- month supply, the highest since November 2012 and comfortably in the balanced territory. It therefore seems that the new stricter bylaws on qualification for uninsured mortgages together with increased interest rates are taking a bite at least in the two most unaffordable large markets in Canada.
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