Home sales in Canada, particularly in Toronto and Vancouver, continue to increase at record levels, keeping the country's housing market red hot. The government said they are monitoring these and are introducing some measures to cool down the market, but one money manager said these can do little at this point.
As reported by CBC News, homes sales in Toronto in March rose 16 percent year on year, while Vancouver recorded a 24 percent increase from February. Last month, the average sale price for a detached home in GTA reached over $910,000 while in Vancouver, it soared to $1.34 million.
Finance Minister Bill Morneau said Ottawa's housing strategy will ensure the availability of affordable housing by encouraging new developments and increasing funding for rental housing, CTV News reported. However, reports say that the government's efforts to slow down price growth seem to have little effect as Canadians are now required to put up 10 percent down payment at least to purchase a home that is worth more than half a million dollars.
Kash Pashootan, a senior vice-president at First Avenue Advisory, Raymond James Ltd., said that while it is good that the government is being on the top of the housing market situation in the country, the question is "[Are] we too far down the road?"
"I think the risk is there," said Pashootan told BNN. "If we have some sort of cooling, we're going to have a scenario, per se, to deal with regardless of what the government does at this point."
Morneau promised that the government will stay focused on the issue, saying that, "We want to make sure that our housing market stays one that is working effectively. And as we see challenges, we will of course think about ways that we can respond that ensure that our market remains stable."