(Adds inventory, price details, economists' comments)
By Andrea Hopkins
TORONTO Aug 15 Sales of existing homes in
Canada rose in July to their highest level since March 2010,
notching their sixth straight monthly increase after a slow
winter, the Canadian Real Estate Association (CREA) said on
CREA, the industry group for real estate agents, said sales
were up 0.8 percent last month from June, surpassing June's
downwardly revised 0.6 percent increase. Actual sales for July,
not seasonally adjusted, were up 7.2 percent from July 2013.
Canada's housing market has roared back to life after an
especially brutal winter that hurt home-building, sales and
prices. The bounce-back has been bolstered by low mortgage
rates, which are not expected to rise significantly until 2015.
"The (recent decline in mortgage rates) will prove to be the
more important determinant over the rest of the year," Mazen
Issa, senior Canada macro strategist at TD Securities, said in a
"While we do expect that higher rates will curtail housing
market activity, the magnitude remains small," he added.
"The true catalyst will be the next stage of the policy
normalization process by the Bank of Canada, which we do not
expect will happen until the second half of 2015," Issa said.
CREA's home price index rose 5.3 percent from July 2013,
little changed from June's 5.4 percent gain. The national
average price for homes sold in July, not seasonally adjusted,
was C$401,585 (approximately $368,000), up 5 percent from the
same month last year.
"Low mortgage interest rates continue to bolster home sales
activity," Gregory Klump, CREA's chief economist, said in a
"With the Bank of Canada widely expected to hold interest
rates steady until next year, mortgage financing will remain
attractive over the second half 2014 and continue to support
Canadian economic growth, while waiting for Canadian exports and
investment to improve."
The national sales-to-new listings ratio was 53.6 percent in
July, little changed from 53.4 percent in June and firmly
entrenched in what is considered balanced territory.
There were six months of inventory at the end of July,
unchanged from June and May, but half a month below the
inventory level at the beginning of 2014, CREA said.
(Reporting by Andrea Hopkins Editing by W Simon and Peter