It's 200 comment time again, so here's a brief update to carry us to Monday. By the way I still see no signs of a spring market. Where are the sales?
What happens when you remove buyers from the market? Well aside from the real estate industry having a coronary, it weakens market conditions.
Months of inventory is highly seasonal, so to clearly see the effect of the restrictions CMHC imposed in July 2012 without resorting to the always suspect "seasonal adjustment", we can look at the MOI over the last year by taking the cumulative inventory and dividing it by cumulative sales for the past 12 months.
You can see a clear upturn in the MOI after the mortgage restrictions came into effect. Even in Victoria, where clearly no one needs anything as dirty as CMHC, it seems the market is driven by credit.