Home sales in Canada fell to a seasonally adjusted 42,799 units in February 2010, a -1.5% drop from January, according to The Canadian Real Estate Association (CREA).

Actual residential sales activity across the country numbered 36,275 units in February 2010, a +44% increase on February 2009, with record activity in Ontario and Quebec. The year-over-year gain in national activity was smaller than those of the previous three months. The average price of homes sold in February 2010 was $335,655, up +18.2% from a year ago.

Dale Ripplinger, CREA’s president, said: “The Olympic Winter Games may have impacted February sales activity in British Columbia, so activity for the province in March will be closely watched. Activity is expected to remain elevated in Ontario and British Columbia over the first half of the year, with buyers looking to beat the introduction of the HST and expected interest rate hikes.”

Although the national sales activity has slowed, new listings continue to rise which has resulted in a more balanced national resale housing market, this is evident as Vancouver saw the biggest decline however Toronto saw an equally large gain.

Gregory Klump, CREA’s chief economist, said: “Housing markets are becoming more balanced, there are still a number of major markets where sales negotiations favour the seller due to a shortage of inventory, but supply has begun rising. Further expected supply increases will continue to take the steam out of housing markets as the year progresses.”

Strong resale housing demand continues to reduce inventories, but the supply is shrinking at a decreasing rate due to slightly softer sales activity and an increase in new listings in recent months. There were 188,334 homes listed for sale on Boards’ MLS® Systems in Canada at the end of February 2010, this is a decline of -15.4% in comparison with February 2009. It is the smallest year-over-year decline in active listings since August 2009.