House sales in Toronto experienced a 70-per-cent collapse in August, the trade industry group BILD reports.

The news comes as debate reaches a fever pitch over whether Toronto’s housing market is in the midst of a bubble.

There were 1,242 new homes sold in the Greater Toronto Area in August of 2012, down 70 per cent from 3,496 sales in August of the previous year, according to data compiled for the Building Industry and Land Development Association (BILD).

That represents the lowest monthly volume since 2009, BILD said in a statement, and the lowest sales for the month of August ever recorded in the 13 years BILD has kept track.

BILD suggested the slowdown may have to do with the federal government’s recent decision to tighten mortgage rules, which saw the maximum amortization period for a government-insured mortgage fall from 30 years to 25, and the maximum amount that can be borrowed against one’s home reduced to 80 per cent of equity, from 85 per cent.

"The federal government has been working on reducing household debt levels and recently adjusted mortgage lending rules. August was the first full month with the new rules in place and it appears these regulations have affected consumer confidence, resulting in significantly reduced sales of new homes," BILD President and CEO Bryan Tuckey said in a statement. "BILD will be carefully monitoring new home sales during the next three months to see if this decline becomes a trend."

Toronto’s housing market — in particular its condo market — has been the source of worry recently for many analysts who say prices and sales volumes have outstripped economic fundamentals.

In a recent blog post, analyst Ben Rabidoux described Toronto’s housing market as “a fly in search of a windshield.”

Rabidoux argued that supply and demand are becoming out of whack in the city. In spite of steep drops in sales volumes, “developers continue to launch new products, and at an eye-popping pace. In August, housing starts in the multi unit segment (primarily condos) soared 108 per cent over last year.”

While many prospective home buyers may cheer to hear that homes could soon be more affordable, at least in Toronto, economists warn that a significant slowdown in housing could have repercussions for the entire economy.

In a report issued last month, Scotiabank warned that “balance sheets heavily skewed to real estate leave Canadians vulnerable to an adverse shock, including a sharp rise in unemployment and/or a sharp drop in home prices.”

Scotia predicted that home prices would decline on average 10 per cent across the country, and the market would take a decade to recover, based on previous housing market cycles.

But Capital Economics predicts a 25-per-cent decline in house prices, which would inevitably lead to rising unemployment. As BILD noted in its report, there are 193,000 people employed in construction in Toronto alone.

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  • 10. Kingston, Ontario - $980

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 9. Kawartha Lakes, Ontario - $981

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 8. Barrie, Ontario - $991

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 7. Edmonton, Alberta - $1,036

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 6. Victoria, B.C. - $1,046

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 5. Ottawa, Ontario - $1,104

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 4. Calgary, Alberta - $1,113

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 3. Toronto, Ontario - $1,164

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 2. Vancouver, B.C. - $1,210

    Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>

  • 1. Fort McMurray, Alberta - $2,031

    Due to a constant influx of high-paying jobs, Fort McMurray, the centre of the oil sands industry, has the highest apartment rental costs in Canada.<br> <br> Number represents the average price of a two-bedroom apartment per month, as of April 2012. Source: <a href="http://www.cmhc.ca/" target="_hplink">CMHC</a>


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  • 10: South Africa - down 3.95%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 9: Sweden - down 4.18%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 8: Slovakia - down 5.61%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 7: Cyprus - down 7.68%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 6: Poland - down 8.19%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 5: Netherlands - down 10.12%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 4: Portugal - down 10.95%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 3: Greece - down 11.92%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 2. Spain - down 13.18%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>

  • 1. Ireland - down 16.85%

    Source: <a href="http://www.globalpropertyguide.com/house-prices-indices/House-price-changes-year-to-end-Q2-2012" target="_hplink">Global Property Guide</a>


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  • 12. Vancouver: $18.9 Million

    <strong>4798 Drummond, Vancouver:</strong> Located in Vancouver's posh Point Grey neighbourhood, this house features 15,000 square feet of living space across eight bedrooms, a circular driveway, fountain and gazebo.

  • 12. Vancouver: $18.9 Million

    The circular grand foyer features marble floors. There is also a pool room (with a steam room and sauna), a media room, game room and recreation room. The garage fits eight vehicles.

  • 11. Toronto: $18.9 Million

    <strong>75 Highland Crescent, Toronto:</strong> This house boasts "breathtaking views of the city skyline." There are four bedrooms and six bathrooms in this "smart home" that features "Porsche design" entry systems, security cameras, a power entry gate and a car elevator.

  • 11. Toronto - $18.9 Million

    The house has a walk-in pool and sauna, a hot tub, a games room and a climate-controlled wine cellar. There's also an outdoor sound system with which to annoy your wealthy neighbours.

  • 10. Oakville, Ont.: $18.9 Million

    <strong>2100 Lakeshore East, Oakville:</strong> This six-bedroom house sits on the shores of Lake Ontario in Oakville, near Toronto. Situated on 3.2 acres, it has 185 feet of waterfront and a boat house.

  • 10. Oakville, Ont.: $18.9 Million

    The property features a triple car garage, a foyer of Italian limestone and a two-story living room. Security cameras can be controlled by way of a security panel. And the view from the back-yard pool can't be beat.

  • 10. Oakville, Ont.: $18.9 Million

    Check out this virtual tour.

  • 9. Austin, Quebec: $18.9 Million

    <strong>105 Chemin Fisher, Austin:</strong> The realtor selling this property suggests you may want to build a heliport to get to this 200-acre estate located in a secluded corner of Quebec's eastern townships. There are several houses on this site, the main one being built in 1927. Another building is described as a "three-season chalet" and is located next to the 120-foot dock on Lake Mephramagog.

  • 9. Austin, Quebec: $18.9 Million

    The property features multiple garages, including a 40-foot-long one. The whole place is so ritzy that a <em>barn</em> on the property was declared a historical site.

  • 8. Caledon, Ont.: $19 Million

    <strong>17485 McLaren Rd., Caledon, Ont.:</strong> No fewer than ten bedrooms and seventeen bathrooms in this house in Toronto's cottage country. The terrain features ravines, ponds and rolling farmland. Not to mention a spa, tennis court, pool room and a hobby workshop.

  • 8. Caledon, Ont.: $19 Million

    The realtor boasts that this property has been "in the same family for almost 100 years." One has to wonder whether this was intentional, given how long this estate has been on the market (it was there this time last year as well.) Nevertheless, a fantastic and absolutely classy dining room in this house.

  • 7. Toronto: $19.5 Million

    <strong>346 Riverview, Toronto:</strong> Located in Toronto's prestigious Rosedale district, this six-bedroom, 11-bathroom house sits on a one-acre lot. Fourteen-foot ceilings, a wine cellar and an orangerie are among the features to be found here.

  • 7. Toronto: $19.5 Million

    The modernist interior design is complemented by a basement home theatre, gym and a spa featuring its own sauna and steam rooms.

  • 6. Vancouver: $19.8 Million

    <strong>4880 Drummond, Vancouver:</strong> Yet another house in Vancouver's Point Grey neighbourhood has made this list, this time a 9,000-square-foot mansion featuring seven bedrooms and bathrooms, and a four-car garage.

  • 6. Vancouver: $19.8 Million

    The realtor promises "gorgeous water views" from many parts of the house, including the kitchen. The property features an exercise room and pool room, an extra-large master bedroom suite (also with ocean views), and this home theatre done up in a slightly art-deco style.

  • 5. Vancouver: $19.9 Million

    <strong>5771 Newton, Vancouver:</strong> There aren't too many private homes to be found on the splendidly isolated grounds of the University of British Columbia, but this property near Northwest Marine Drive is one. Seven bedrooms and eight bathrooms in this 12,000-square-foot home.

  • 5. Vancouver: $19.9 Million

    The house features a "bonus wok kitchen," as the realtor describes it, on top of its regular kitchen, and the house in all boasts a games room, professional calibre gym, an indoor pool and granite floors. The patio is big enough to hold a wedding party, according to the realtor.

  • 5. Vancouver: $19.9 Million

    Check out this virtual tour.

  • 4. Toronto: $28 Million

    <strong>1400-155 Cumberland, Toronto:</strong> This condo in Toronto's Yorkville district (the heart of the film festival) is monstrous by apartment standards: 10,000 square feet on two floors. Four bedrooms, five baths and "breathtaking views."

  • 4. Toronto: $28 Million

    All but two of the condo's rooms open on a 5,000-square-foot terrace. The house features a library and a wine cellar, and comes with no fewer than four parking spots -- a heck of a lot by Toronto standards.

  • 4. Toronto: $28 Million

    Check out this virtual tour.

  • 3. Vancouver: $28.8 Million

    <strong>PH01-1011 West Cordova, Vancouver:</strong> This condo may well be located in the most prestigious apartment building in Canada -- no other building has had units featured in HuffPost's "most expensive" lists quite as often as 1011 West Cordova, also known as The Fairmont Pacific Rim.

  • 3. Vancouver: $28.8 Million

    Penthouse 1 is described as the most prestigious condo in the building, and features two levels of living space and multiple patios and rooftop gardens. With only three bedrooms, the condo works out to $9.6 million per bedroom.

  • 2. Vancouver: $31.9 Million

    <strong>3390 The Crescent, Vancouver:</strong> Villa Russe, as this estate is known, is located in Vancouver's Shaugnessy Heights and features six bedrooms (the master bedroom has three dressing rooms), five fireplaces and eight bathrooms.

  • 2. Vancouver: $31.9 Million

    Given how expensive this property is, we're a little surprised the sellers stress walking-distance access to amenities. But in Vancouver, even residents of homes that feature their own greenhouses, heated pools and fish ponds prefer to walk sometimes.

  • 1. Vancouver: $34 Million

    <strong>5365 Seaside Place, West Vancouver:</strong> We thought we'd show you the pool house first, just because it looks so cool.

  • 1. Vancouver: $34 Million

    This house on a peninsula in ritzy West Vancouver features four bedrooms and six baths over 9,000 square feet -- spacious indeed.

  • 1. Vancouver: $34 Million

    Six hundred and fifty feet of natural shoreline on this property.

  • 1. Vancouver: $34 Million

    The house was rebuilt in 2008, and features geothermal heating and integrated lighting and security. The boat house will fit anything up to 40 feet long, and the garage fits five cars.