Toronto - Toronto home sales and prices surged in March, an industry report showed on Wednesday, fuelling fears of a bubble in Canada’s largest city and ramping up expectations the province of Ontario will act soon to cool the market.
The average home price in Toronto rose 33.2 percent in March to C$916567 (R9.36 million) from a year earlier, while sales increased 17.7 percent, according to a report from the Real Estate Board.
Toronto prices have more than doubled since 2009, even as the other parts of the country have cooled in response to repeated attempts by the federal government to tighten mortgage lending rules to rein in overheated markets.
With even mainstream Canadian economists calling the Toronto market a bubble and finance minister Bill Morneau saying national policies are not the best tool to tackle local market imbalances, the pressure has shifted to Ontario to address the problem.
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Ontario finance minister Charles Sousa has said his provincial budget, expected within weeks, will address housing affordability, but observers are uncertain whether he will implement a foreign buyers' tax like British Columbia did last year to cool the Vancouver market.
“They are probably going to proceed cautiously and try to help out on the supply side,” said Michael Dolega, senior economist at TD Bank Group.