11/05/2014 05:22 EST | Updated 01/05/2015 05:59 EST

Toronto, Vancouver home prices continue to surge

Home prices jumped higher in Canada’s two largest cities in October, with the average Toronto home selling for $587,505, 8.9 per cent more than a year ago. The benchmark resale price for all residential properties in Metro Vancouver was $637,000, a six per cent year-over-year increase.

Both cities also saw an increase in the number of homes sold over the same month last year as buyers continue to take the plunge despite higher prices.

Toronto sales increased by 7.7 per cent to 8,552 homes last month, according to the Toronto Real Estate Board.

The average selling price for a home in the Greater Toronto Area was up 8.9 per cent compared to the average of $539,286 reported for October 2013. In the city of Toronto, the average selling price was $633,078 while in the rest of the GTA it was $557,135.

“While sales growth has tracked strongly so far this fall, many would-be home buyers have continued to have difficulties finding a home due to the constrained supply of listings in some parts of the Greater Toronto Area, particularly where low-rise home types are concerned,” said Jason Mercer, director of market analysis for the Toronto Real Estate Board.

Vancouver sales pick up

In Greater Vancouver there were 3,057 home sales last month, up 14.9 per cent from October 2013.

A single family detached home sold for a benchmark price of $995,100, while the benchmark price of an apartment increased four per cent from October 2013 to $380,200. The Real Estate Board of Metro Vancouver uses the MLS Home Price Index to report prices. This method uses a complex statistical model to measure the rate at which housing prices change over time by tracking price changes in typical benchmark homes in each market.

“We’ve seen strong and consistent demand from home buyers in Metro Vancouver throughout this year. This has led to steady increases in home prices of between four and eight per cent depending on the property,” said Ray Harris, president of the Real Estate Board of Metro Vancouver.