04/21/2016 01:26 EDT | Updated 04/22/2017 05:12 EDT

Real Estate Report Offers Reason Why Canadians Don't Want To Sell Their Homes

Even homeowners are scared of the high prices out there.

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House sold

TORONTO — A new report suggests the red hot real estate markets in Vancouver and Toronto are discouraging some potential sellers from listing their homes because they're afraid of becoming buyers themselves.

The spring market trends report by real estate firm Re/Max on Thursday says while homeowners in those cities know their homes will sell quickly, many are reluctant to become buyers in the highly competitive market.

Read more: Homes Available For Sale In Toronto, Vancouver Reach Record Low

Re/Max says some are also reluctant to list their homes because they believe that prices could move even higher.

Vancouver and Toronto have been the hottest real estate markets in the country, raising questions about affordability, the role of speculators and the influence of foreign buyers.

The average residential sale price in Vancouver in the first quarter was $1,103,586, up 24 per cent from a year ago, according to Re/Max.

The average price in Toronto was $675,492, up 14 per cent.

The number of homes for sale has dropped to record lows in Toronto and Vancouver even as prices reach record highs. Re/Max says it's partly because homeowners are afraid to become buyers themselves in a highly competitive market. (Chart: National Bank Financial)

The report suggested the strength of Toronto and Vancouver are helping drive prices in neighbouring regions as buyers move further out in search of an affordable home.

The report noted that Hamilton-Burlington and Barrie in Ontario as well as Victoria have seen prices rise 10 per cent or more compared with a year ago.

"The population growth in these regions, driven by housing demand, is growing local economies as restaurants, shops and services expand," the report said.

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