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Property prices in Canada increased by 10.1% compared with a year earlier, taking the national average price for homes sold in February to $406,372, according to the latest figures from the Canadian Real Estate Association.

CREA says that the size of year on year average price gains continues to reflect the decline in sales activity in February of last year among some of Canada’s most active and expensive markets, which dropped the national average at that time. This phenomenon was particularly clear this month, with Greater Vancouver having posted the biggest year on year increase in activity by a large margin.

The MLS Home Price Index, regarded as providing a better gauge of price trends because it is not affected by changes in the mix of sales activity the way that average price is, rose 5.05% on a year on year basis in February, up from a 4.83% gain in January. Year on year price growth picked up among all property types tracked by the index.

Price increases were led by two story single family homes with growth of 5.84% and one story single family homes at 5.4%. This was closely followed by price increases for town house and terraced units up 4.05% and apartment units up 3.74%.

The biggest gains were recorded in Calgary where prices jumped 9.1% and Greater Toronto with growth of 7.28%. Greater Vancouver’s recorded a fourth consecutive year on year increase of 3.17% while prices in Victoria remained lower than year ago levels, down 1.01%, the smallest in more than three years.

Sales were largely unchanged with an increase of just 0.3% compared to January but the slight rise follows five straight monthly declines and means that transactions are 9.3% below the peak reached in August 2013.

The number of local housing markets where February sales were up ran roughly even with the number of markets where sales declined, with little change in activity among most of Canada’s large urban markets.

‘Sales in February rebounded in some of the smaller local markets where activity was impacted by harsh winter weather in January. The strength of sales activity during the crucial spring market period will be influenced by the availability of listings, which varies considerably from market to market,’ said CREA president Laura Leyser.

Sales activity this spring will be supported by the recent decline in the benchmark five year conventional mortgage rate, according to Gregory Klump, CREA’s chief economist.

‘That’s because buyers needing mortgage default insurance who opt for a term of less than five years must qualify for mortgage financing based on that rate, and not a discounted rate that their lender may be offering. The support will be of particular importance in some of Canada’s larger urban markets where home prices are higher than those in smaller markets,’ he added.

The number of newly listed homes was also little changed in February, having edged up 0.6% on a month on month basis. As with sales activity, there was a roughly even split between the number of local markets where new listings were up from the previous month and those where they were down.

The number of new listings nationally would have declined had it not been for a 7.8% increase in Greater Toronto, where new listings in January had dropped to the lowest level in more than three years. The rise in new listings in Greater Toronto was offset by monthly declines in new listings in Greater Vancouver and Edmonton.

With sales and new listings having both edged slightly higher in February, the national sales to new listings ratio was 52.1%, virtually unchanged from 52.3% in January. Since early 2010, the ratio has remained firmly entrenched within the range from 40 to 60% that marks balanced territory. Just under two thirds of all local markets posted a sales to new listings ratio in this range in February.

The number of months of inventory is another important measure of balance between housing supply and demand. It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.

There were 6.4 months of inventory at the national level at the end of February 2014, down slightly from 6.5 months at the end of January. As with the sales to new listings ratio, the months of inventory measure continues to point to a well balanced housing market at the national level.

This article was republished with permission from Property Wire.