Toronto New Home Sales Plunge 64 Percent; Lowest August on Record

New home sales in Toronto plunged 64% in the wake of government's changes to insured mortgages (30yr to 25yr) and home equity line of credit restrictions (80% max to 65% max) which took effect in July.

Lowest August on Record

Reader Corey emailed the above comments and a news link from the Canada BILD Association: New Home Sales Slip in August.

According to RealNet Canada Inc., BILD's official source of new home market intelligence, the 1,242 homes sold in August 2012 add up to the lowest monthly sales since 2009 and the lowest August on record. Year-to-date sales have remained on par with 2010 but below its record-breaking 2011 predecessor.

"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," explained BILD President and CEO Bryan Tuckey. "BILD will be carefully monitoring new home sales during the next three months to see if this decline becomes a trend."

August '12	Low Rise			High Rise			Total
Region	2010	2011	2012	2010	2011	2012	2010	2011	2012
Durham	182	206	119	7	7	12	189	213	131
Halton	241	610	75	24	283	15	265	893	90
Peel	202	281	267	89	63	66	291	344	333
Toronto	18	47	22	751	1,027	469	769	1,074	491
York	356	385	114	108	587	83	464	972	197
GTA	999	1,529	597	979	1,967	645	1,978	3,496	1,242
GTA % Chg			-60.95%			-67.21%			-64.47
Jan-Aug	11,212	12,357	10,710	12,347	18,055	13,591	23,559	30,412	24,301

"Slip" hardly seems the operative word. Crash is more like it.

Also consider Bernanke Declares War on Canadian Economy (Rest of the World Too)

Addendum:

I said Canada previously but those sales are specifically the Toronto region. 

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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