Canada’s finance minister says monitoring housing markets very closely By Reuters

© Reuters. FILE PHOTO: A row of houses stand in a subdivision in East Gwillimbury, Ontario

OTTAWA (Reuters) – Canada’s federal government is watching the country’s red-hot housing market “very closely” and is aware that rising prices make it more difficult for many young Canadians to buy a home, Finance Minister Chrystia Freeland said on Thursday.

“We are of course watching housing markets across the country very, very closely and carefully,” she told reporters in a press conference.

“We are very aware also of the challenges that many Canadians face – particularly young Canadians – in buying a home,” she said. “So it’s something that we’re looking at carefully.”

Canadian home prices jumped 25% in February from a year ago, with the average resale price hitting a record C$678,091 ($537,698). Prices were up 9.1% from January.

The eye-watering gains are prompting calls for action, though policymakers have so far been unwilling to intervene for fear of undermining Canada’s still-fragile economic recovery from the COVID-19 pandemic.

Bank of Canada Deputy Governor Toni Gravelle told Reuters earlier this week that the central bank is seeing signs of increased investor activity in the market and is concerned “fear of missing out” may also be driving gains.

Gravelle also said housing market activity is increasingly taking a front seat in discussions between Bank policymakers and their federal government counterparts.

Freeland on Thursday also announced that the government had presented new legislation to provide C$7.2 billion in “critical support” to provinces, territories and other entities in the

The bill, which must go through parliament and will require the support of at least one opposition party, includes C$4 billion in transfers to the provinces and territories for immediate healthcare needs, C$1 billion toward vaccination plans, and up to C$2.2 billion in infrastructure money.

($1 = 1.2611 Canadian dollars)

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