OTTAWA - Buyers in Toronto and Montreal pushed home sales higher last month as Canadians continued to take advantage of low interest rates.
The Canadian Real Estate Association said Friday home sales in April through its MLS system were up 2.3 per cent compared with the previous month.
The increase was the third consecutive month-over-month climb, but the gain was down from the 4.1 per cent increase in March.
"As expected, low mortgage interest rates and the onset of spring ushered many homebuyers off the sidelines, particularly in regions where winter was long and bitter," CREA president Pauline Aunger said in a statement.
Sales were up on a month-over-month basis in two-thirds of the markets tracked, led by a 4.4 per cent gain in Montreal and a 2.9 per cent increase in Toronto.
Compared with a year ago, sales across the country were up 10 per cent, boosted by the big gains in the Greater Vancouver and Fraser Valley regions as well as Toronto.
However, compared with a year ago, sales in Edmonton, Calgary and Regina were sharply lower as a slowdown in the oilpatch took its bite out of those markets.
Bank of Montreal chief economist Doug Porter said Toronto and Vancouver remain the hot markets but the April sales showed more strength than just those two cities.
"Only four of the top 26 cities reported notably weak sales last month, and they are clustered tightly in the two biggest oil-producing provinces," Porter said.
"Calgary, Edmonton and Regina were the only cities to post double-digit yearly declines in sales last month, and Saskatoon was nearby. But even among these laggards, there are signs that things are stabilizing, with seasonally adjusted sales nearly flat from the prior month's level among these four cities."
The gains nationally have come as Canada's big banks have competed fiercely for homebuyers during the spring real estate season this year with ultra-low rate offers.
However, the bond market has suffered in recent days, driving yields higher and raising the prospect of higher mortgage rates that could dampen the real estate market.
"The Vancouver and Toronto markets should cool slightly once mortgage rates move back up," said TD Bank economist Dina Ignjatovic.
"However, given the tightness in these markets, prices should remain relatively strong. Further weakness in oil-rich regions will only partially offset strength elsewhere, with overall price growth likely to average around six per cent this year."
The national average price for a home sold in April was $448,862, up 9.5 per cent from April 2014. However, excluding Vancouver and Toronto, the average price was $339,893, up 3.4 per cent from a year ago.
The aggregate composite MLS home price index was up 4.97 per cent on a year-over-year basis in April.
CREA said the number of newly listed homes in April was up 0.1 per cent compared with March with the supply increasing in nearly two thirds of all markets.