The Canadian Real Estate Association's chief economist believes home price increases are getting out of control. He added that he does not foresee things changing until COVID-19 tails off and more house listings become available.

January's average resale types for property types across the board was $621,525, an almost 23 percent increase from last January, as reported by the CREA.

Home sale numbers rose to just over 35 percent from last year. Last month had the highest total for a January on record. New listings had the contrary, where listings dropped 13.5 percent across Canada. Toronto and Montreal felt the brunt of this shortage, with a 35 percent decrease in new listings.

“There were only 1.9 months of inventory on a national basis at the end of January 2021 – the lowest reading on record for this measure,” explained the CREA. In Quebec and Atlantic Canada, the proportion of sales to new listings was above 100 last month.

“This means that there were more sales than new units listed last month in these provinces. This is a rare situation, but has occurred before in the Atlantic provinces. However, January marked a first on this front in Quebec, said TD Bank economist Rishi Sondhi.

The national sales to new listings ratio is at 90.7 percent, its highest figure in 19 years.

Economists point to historically low interest rates for propelling the homebuying frenzy. As prices have skyrocketed, monthly mortgage payments have plunged, thus making home ownership more accessible and affordable.

“A big surge in supply is what so many markets really need this year to get people into the homes they want, and to keep prices from accelerating any more than they already are,” stated CREA senior economist Shaun Cathcart.

“We’re unlikely to see a rush of listings until the weather and public health situations improve, and we won’t see buyers until those homes come up for sale.”