Home sales in Canada fell in October compared to the month before and static mortgage interest rates may continue to keep sales in check, according to the Canadian Real Estate Association, the National Association of Realtors’ equivalent to the north.

Homes sales declined 3.2 percent on a monthly basis last month, but still rose 8.3 percent compared to October 2012.

“October’s lower activity provides early evidence confirming that sales in the later summer and early fall were boosted by homebuyers with preapproved mortgages at lower-than-current interest rates jumping into the market before their preapprovals expired,” said Gregory Klump, CREA’s chief economist, in a statement.

“Now that interest rates appear to be going nowhere fast, sales activity in the near term may be held in check by homebuyers who are in less of a hurry to purchase. While the finance minister will no doubt continue to keep a close eye on Canadian housing markets for signs of overheating as interest rates remain low, October sales results may provide him with reassurance that tightened mortgage regulations and lending guidelines are working as intended.”

On a seasonally adjusted basis, October’s sales were just 0.9 percent higher than the average number of monthly sales over the past 10 years, CREA said. The trade group’s MLS Home Price Index increased 3.5 percent year over year in October. Months supply of inventory stood at six months, indicating neither a buyer or seller’s market.

“A majority of local markets across the country are still seeing a healthy balance between buyers and sellers coupled with modest price growth,” said CREA President Laura Leyser in a statement.

Source: CREA

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