OTTAWA — The federal finance minister says steps taken to tame Canada’s hottest housing markets have already helped slow down a sector he believes was moving at an unsustainable clip.
Bill Morneau’s comments Tuesday follow this week’s release of data showing Canada’s home sales for June posted their biggest monthly plunge in seven years. The national figure was led by a drop in the Greater Toronto market.
The new data provided the latest evidence that steps taken at federal, provincial and municipal levels have begun to temper the country’s real estate sector, particularly in the Vancouver and Toronto regions.
“What we’ve put in place has had some impact — and some impact in having a slight cooling in the market, which of course was our objective,” Morneau told The Canadian Press in an interview at his Ottawa office.
“We thought that the price increases in Vancouver and Toronto, specifically, were unsustainable.”
Earlier Tuesday, Morneau told a news conference that changes in the housing sector were playing out “largely the way we thought it might.” He also noted, however, that it was “too early” in the emerging situation to draw conclusions.
On a national basis, last month’s housing transactions were down 6.7 per cent compared with May, the Canadian Real Estate Association said Monday. It was the third-straight monthly decrease and the Greater Toronto Area registered a 15.1 per cent drop.
Compared to May, sales fell last month in 70 per cent of all local markets measured by the association, including the Lower Mainland in B.C., Montreal and Quebec City.
Earlier this year, the Ontario government put in place more than a dozen measures to curb the Toronto market, including a 15 per cent tax on foreign buyers. Since then, sales in Canada’s largest city have slowed.
A number of federal measures have also been introduced in recent years to address housing market concerns during the extended period of low interest rates.