At $716,828, the average price of a Canadian home has never been higher.

Canada's red-hot housing market continues to defy expectations, with sales in March up 70 per cent compared to a year ago and average prices up by more than 30 per cent.

The Canadian Real Estate Association said Thursday that more than 70,000 homes were sold last month, obliterating the previous record for the month by 22,000 transactions. The figure was 76 per cent higher than the same month a year ago, which saw sales slow because it was the first month of restrictions related to COVID-19.

Those restrictions put a temporary chill on the market, but things started heating up in May 2020 and haven't cooled down since.

On the price side, the average selling price for a home sold on CREA's MLS system was $716,828. That's up by 31.6 per cent in a year, and the biggest annual pace of gain on record.

While sellers and owners are doubtless ecstatic with record selling prices, the torrid pace is causing anxiety among economists and policy-makers who worry that first-time buyers are being locked out of the market unless they take on massive mortgages that they may not be able to afford if interest rates rise.

Last week, Canada's top banking regulator proposed to raise the stress test level on mortgages to make sure that borrowers can afford higher rates. That move would reduce the purchasing power of buyers by about five per cent.

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