Canadian home sales fall in September as mortgage rates increase, CREA says

By Promit Mukherjee OTTAWA, Oct 16 (Reuters) — Canadian home sales extended their decline in September, after a drop in August, as higher mortgage rates and expectations of a Bank of Canada rate hike dampened activity, the Canadian Real Estate Association said in its monthly note on Friday. National home sales declined 2.3% month-over-month in September following a drop of 0.7% in August. Sales were down 7.7% on an annual basis, without seasonal adjustment. The industry group's Home Price Index was down 0.4% on a monthly basis and was down 3.4% from a year ago. After a rebound in August, the number of newly listed properties fell by 1.8% on a month-over-month basis. The seasonally adjusted sales-to-new listings ratio for residential category slipped to 48.8% from 49.1% in August, moving further below the long-term average of 54.7%. "This was hardly surprising given the latest jump in fixed mortgage rates, and with the Bank of Canada now widely expected to follow with a rate hike before the end of the year,” said Shaun Cathcart, CREA’s senior economist said in a note about the drop in home sales. The BoC is not expected to raise interest rates at its next monetary policy decision an