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February 17, 2010
National resale activity edges down in January
OTTAWA – February 17th, 2010 – According to statistics released by The Canadian Real Estate Association, the number of homes sold through the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards declined in January 2010 from the previous month.
Seasonally adjusted national home sales dropped 2.8 per cent from near record levels reported in December. Ontario accounted for about half the national decline. Activity was also down in British Columbia, Alberta, and Manitoba, but reached new heights in Quebec.
OTTAWA – January 15th, 2010 – Existing home sales activity reached the highest level ever for the month of December, according to statistics released by The Canadian Real Estate Association. Strong demand in the second half of 2009, especially in the fourth quarter, pushed annual sales above 2008 levels. Residential sales activity via the Multiple Listing Service® (MLS®) of Canadian real estate boards numbered 27,744 units in December 2009. This stands 72 per cent above activity in December 2008, when activity dropped to the lowest level in a decade. New records for the month of December were reported in Ontario, Quebec, Saskatchewan, New Brunswick, and Newfoundland & Labrador. Seasonally adjusted national home sales totalled 46,805 units in December, capping the strongest fourth quarter period ever. A total of 137,957 homes traded hands on a seasonally adjusted basis in the fourth quarter of 2009. This is up 2.6 per cent from the previous record set in the first quarter of 2007.
New quarterly records were set in British Columbia, Ontario, and Quebec. National sales activity began 2009 on a weak footing. Despite year-over-year increases in the second and third quarters of the year, year-to-date activity was still trailing 2008 levels at the end of September 2009. A 59 per cent year-over-year gain in the fourth quarter of 2009 pushed sales activity above annual levels for 2008. “Sales activity in 2009 came in like a lamb and went out like a lion,” said CREA President Dale Ripplinger. “The continuation of unusually low interest rates may keep national sales activity near current levels over the coming months, as will a blip in housing demand in Ontario and British Columbia from home buyers motivated to beat the introduction of the HST.”
Annual activity in 2009 was down 10.7 per cent from the peak reached in 2007. A total of 465,251 homes traded hands through the MLS® systems of real estate boards in Canada in 2009. This is up 7.7 per cent from 2008 levels, and represents the fourth highest level on record for annual activity. The national residential average price was $337,410 in December, up 19 per cent year-over-year. On an annual basis, average price climbed five per cent to a record $320,333.
Average prices set new annual records in a majority of local markets in 2009, and in every province except Alberta. The large year-over-year increase in the national average price in December reflects the high degree to which it was skewed downward in late 2008 by unusually low activity in Canada’s priciest markets. The national average price was also skewed upward by rebounding activity in the spring and summer months of 2009. The national average price rose to unprecedented heights at that time, despite records having been set in only a small number of local markets. 2009 resale housing market ends on a high note The contribution of activity by higher priced markets toward the national average price has recently returned to more typical levels.
Record level average prices in most regions are now driving the national average price to new heights. The price trend is similar but less dramatic for the national weighted average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock. It climbed 3.6 per cent in 2009. The residential average price in Canada’s major markets was up 5.5 per cent year-over-year to $348,840 in 2009. As with the national counterpart, the price trend is similar but less dramatic for the major market weighted average price, which rose 2.3 per cent from 2008 levels. Strong demand and headline average price gains are drawing more sellers to the market.
New listings coming onto Boards' MLS® Systems across Canada rose to the highest level on record for the month of December, with a total of 33,090 residential properties coming on stream. This is up 4.8 per cent from December 2008, the first year-over-year gain in a year. On a seasonally adjusted basis, new listings rose by 4.7 per cent in December 2009 compared to the previous month. The recent rising trend in new listings has not yet offset the steep decline in the number of new listings during the first half of 2009. As a result, new listings in 2009 were down 12.6 per cent from the annual peak in 2008. Despite the recent rise in new listings, strong demand for resale housing continues to draw down inventories.
There were 154,264 homes listed for sale on Boards’ MLS® Systems in Canada at the end of December 2009, a decline of 22 per cent from levels reported one year ago. Nationally, there were 4.1 months of inventory in December 2009 on a seasonally adjusted basis. This is the lowest level in more than two years. *Aggregate of sales in Canada's 10 most expensive markets as a percentage of national sales. Based on the 10 markets with the highest annual average price in 2009: Vancouver BC, Fort McMurray AB, Victoria BC, Oakville-Milton ON, Fraser Valley BC, Toronto ON, Calgary AB, Okanagan-Mainline BC, Muskoka & Haliburton ON, and Edmonton AB. The actual (not seasonally adjusted) number of months of inventory in December 2009 stood at 5.6 months, the lowest December figure since 2005, and well below the same month in 2008 (12.3 months). Although up slightly from November (five months), an increase is normal at this time of year since demand normally eases relative to supply over autumn and winter months.
The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity. “CREA’s latest statistics will no doubt spark further bubble talk amongst the usual suspects,” said CREA Chief Economist Gregory Klump. “Cooler heads recognize that many of the recent gains reflect temporary factors that could fade by summer.” “The extraordinary decline in activity one year ago and subsequent rebound, particularly for higher-priced real estate, is stretching current year-over-year comparisons,” he said. “By the second half of 2010, price gains are likely to shrink significantly, since a year will have elapsed since the decline and rebound.” Klump added that, “Further expected increases in supply will also take some steam out of the market.
A more balanced market will result in smaller price increases in the second half of the year, but a massive decline in demand similar to what we saw in late 2008 and early 2009 seems as unlikely as a massive spike in supply.” PLEASE NOTE: The information contained in this news release combines both major market and national MLS® sales information from the previous month. The Canadian Real Estate Association has previously released these separately. CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighborhoods or account for price differential between geographic areas.
Statistical information contained in this report includes all housing types. MLS® is a co-operative marketing system used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale. The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 96,000 REALTORS® working through more than 100 real estate Boards and Associations.
OTTAWA – December 15th, 2009 – According to statistics released by The Canadian Real Estate Association, existing home sales activity remained upbeat in November 2009. The current strength of housing demand stands in sharp contrast to weak activity recorded one year ago.
A total of 36,383 residential properties traded hands via the Multiple Listing Service® (MLS®) of Canadian real estate boards in November 2009. Up 73 per cent from year-ago levels, activity was down just four tenths of a per cent from the highest level of activity for the month posted in November 2007. Home sales set new records for the month of November in Ontario and Quebec.
“National home sales activity last month shows how strongly the housing market has rebounded since the beginning of the year,’ said CREA President Dale Ripplinger. “As we predicted last April, the rebound in resale housing activity led the overall Canadian economy out of recession.” The unprecedented year-over-year gain in activity underscores the extent to which demand has recovered from one year ago, when news of the global financial crisis hammered consumer confidence. Year-over-year gains were biggest in British Columbia (165 per cent) and Ontario (77 per cent).
Since the beginning of 2009, some 437,507 homes have been sold through Canadian MLS® systems. This is up five per cent from activity in the first 11 months of 2008, but below levels for the period in each of the previous three years.
The national residential average price was $337,231 in November, a gain of 19 per cent compared to one year ago. For the year-to-date, the average price is up 4.4 per cent compared to the same period last year. The yearover- year increase in November continues to reflect the high degree to which the average was skewed downward last year by plummeting activity in Canada’s priciest markets, and then upward by rebounding activity. Average price in November edged back from the peak reached in October.
The price trend is similar but less dramatic for the national MLS® weighted average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock. The weighted average price climbed 13 per cent on a year-over-year basis in November. This is a smaller increase compared to the year-over-year gain of 14 per cent recorded the previous month. The residential average price in Canada’s major markets was up 20 per cent year-over-year to $368,665. As with the national counterpart, the price trend is similar but less dramatic for the major market weighted average price which rose 11 per cent from last November.
The return of strong demand and headline average price gains is beginning to draw more sellers back to the market. Seasonally adjusted new listings coming onto Boards’ MLS® Systems across Canada rose five per cent on a month-over-month basis in November to 69,110 units. This is the biggest monthly increase since January 2008. Despite the uptick in new listings, the sharp rise in resale housing demand continues to draw down inventories. There were 183,710 homes listed for sale on Boards’ MLS® Systems in Canada at the end of November 2009. This is down 23 per cent from levels reported one year ago, and the seventh month in a row in which inventories have declined from year-ago levels.
Existing home sales activity remains strong in November Nationally, there were four months of inventory in November 2009 on a seasonally adjusted basis, the lowest level in more than two years. The actual (not seasonally adjusted) number of months of inventory in November 2009 stood at five months, up slightly from the previous month (4.6 months). An increase is normal at this time of year, since demand tends to ease relative to supply over autumn and winter months. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity. “The latest batch of seasonally adjusted statistics may reflect distortions in the seasonal adjustment procedure due to an extraordinarily weak housing market one year ago,” said CREA Chief Economist Gregory Klump. “Deteriorating housing affordability will reign in sales activity as the overall economy further improves and the pool of buyers who qualify for financing shrinks.”
PLEASE NOTE: The information contained in this news release combines both major market and national MLS® sales information of Boards’ MLS® Systems from the previous month. The Canadian Real Estate Association has previously released these separately. CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighborhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.
The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 96,000 real estate Brokers/agents and salespeople working through more than 100 real estate Boards and Associations. Registrants in any province who become members of organized real estate have an obligation to act in accordance with the REALTOR® Code. This Code outlines the accepted standard of conduct for all real estate practitioners who are members of a real estate Board or a Provincial Association. CREA owns the MLS® and REALTOR® trademarks, which signify a high standard of service and identify members of CREA.
According to figures released today by the Canadian Real Estate Association, Monthly MLS® home sales activity continues to run strong, with new monthly records set in July, September, and October. This has prompted The Canadian Real Estate Association to revise its MLS® home sales forecast for 2009 and 2010.
CREA now forecasts national activity will reach 460,200 units in 2009, up 6.6 per cent from last year. CREA’s previous forecast issued in August had annual sales this year about even with 2008 levels. The new sales forecast for 2009 puts activity about on par with annual activity in 2004, but below levels reported for the years 2005 through 2007.
British Columbia and Ontario are still forecast to post annual increases in activity this year, but the forecast has been lifted as a result of recent record level activity in both provinces. In addition, Alberta, Saskatchewan, Quebec, and Prince Edward Island are also now forecast to post an annual increase in activity in 2009. Forecast declines in annual activity have been trimmed for Manitoba and Nova Scotia, and are little changed for New Brunswick and Newfoundland and Labrador.
National MLS® home sales activity is forecast to rise seven per cent to 492,300 units in 2010. This is a slightly larger rise in activity than previously forecast. This would make 2010 the second highest year on record for sales, putting activity below the peak reached in 2007, and slightly above the 2005 and 2006 figures. New annual records are forecast for Manitoba and Quebec in 2010. The forecast increase in activity for 2010 reflects significant weakness in activity recorded in the first quarter of 2009.
Monthly activity in 2010 is expected to trend downward from recent heights, but the sharp drop inactivity recorded in the in the first quarter of 2009 is not expected to repeat in 2010. New listings began declining in the third quarter of 2008, as many sellers took their home off the market pending an improvement in housing market conditions. CREA’s previous forecast suggested that average price increases in the second half of 2009 would likely result in mild a rebound in listings. In the third quarter of 2009, the number of new listings did post the first quarterly increase in more than a year, which coincided with the return of strong average price increases.
New residential listings are expected to continue trending upward. The national MLS® average home price is forecast to climb 4.2 per cent in 2009, reaching a record $317,900. This is an upward revision from the 1.5 per cent gain in CREA’s previous forecast, and reflects the high degree to which the national average price was skewed downward last year by a significant decline in activity in Canada’s priciest markets, and then upward by the rebound in activity. Alberta remains the only province with a forecast decline in average price in 2009 (-3.0 per cent).
Average prices are forecast to rise in all other provinces, with gains ranging from a low of 1.5 per cent in British Columbia to 13.1 per cent in Newfoundland and Labrador. Average prices are forecast to climb a further 4.7 per cent in 2010. Much of the annual increase reflects weakness in the average price in first quarter of 2009, which is not expected to repeat in 2010. Average sale prices are forecast to rise in every province in 2010. MLS® home sales forecast revised The price trend is similar but less dramatic for the weighted national MLS® average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock.
The weighted national MLS® average price is forecast to climb 2.9 per cent in 2009, with a further 4.0 per cent rise in 2010. CREA previously forecast that the weighted national average price for MLS® homes sales would hold steady from 2009 to 2010. “Pent-up demand built in late 2008 and early 2009, as many buyers moved to the sidelines pending an improved economic outlook,” said CREA President Dale Ripplinger. “With the economic outlook having improved since then, the release of that pent-up demand will boost activity over the rest of the year and in 2010.”
“Significant weakness in activity and average prices seen in late 2008 and earlier this year is not expected to repeat in 2010, so 2010 will look a lot better by comparison,” said CREA Chief Economist Gregory Klump. “The raised outlook for MLS® sales activity in 2010 still puts annual activity below the pre-recession peak recorded for 2007.”
PLEASE NOTE: The information contained in this news release combines both major market and national MLS® sales information from the previous month. The Canadian Real Estate Association has previously released these separately. CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighborhoods or account for price differential between geographic areas.
Statistical information contained in this report includes all housing types. The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 96,000 real estate Brokers/agents and salespeople working through more than 100 real estate Boards and Associations. Registrants in any province who become members of organized real estate have an obligation to act in accordance with the REALTOR® Code. This Code outlines the accepted standard of conduct for all real estate practitioners who are members of a real estate Board or a Provincial Association. CREA owns the MLS® and REALTOR® trademarks, which signify a high standard of service and identify members of CREA.
OTTAWA (November 3) – The Canadian Real Estate Association (CREA) today released the following statement in response to the various media reports regarding the proposed resolution between CREA and the Competition Bureau:
“The media has inaccurately reported that a proposed resolution between CREA and the Competition Bureau would result in members of the public being able to access the MLS® System to list their homes for sale without involvement of a REALTOR® member of CREA. This is incorrect. The MLS® system is a system for REALTOR® members of CREA. It would not be appropriate for CREA (or, in CREA's view, for the Competition Bureau) to comment further on ongoing settlement discussions. If a settlement is reached, that will become a matter of public record."
OTTAWA – July 14th, 2009 – National resale housing market activity bounced back strongly in the second quarter of 2009 above levels reported for the same period last year. Demand continues to rebound sharply in some of the most expensive markets in the country, skewing the national average price upward.
According to statistics released by The Canadian Real Estate Association (CREA), actual (not seasonally adjusted) home sales, via the Multiple Listing Service® (MLS®) of Canadian real estate boards, totaled 147,351 units in the second quarter of 2009 – the fourth strongest quarterly sales figure ever. Up 1.4 per cent from the second quarter of 2008, this marks the first year-over-year increase in quarterly activity since the fourth quarter of 2007.
On a seasonally adjusted basis, national MLS® home sales numbered 114,173 units in the second quarter, jumping up a record 31.5 per cent from the first quarter of 2009. “Potential buyers who moved to the sidelines late last year when economic uncertainty peaked are returning to the housing market now that the worst of the recession may be behind us,” said Dale Ripplinger, President of The Canadian Real Estate Association. Seasonally adjusted resale activity in the second quarter was up from the previous quarter in about 85 per cent of local markets. Quarterly activity increases in Toronto (45 per cent), Vancouver (77 per cent), Montreal (33 per cent), Calgary (66 per cent) and Edmonton (39 per cent) contributed most to the national increase in activity.
Strong upward momentum for monthly sales activity was sustained throughout the second quarter. June marked the fifth consecutive month in which activity was up from month-ago levels. Some 41,304 homes traded hands via the MLS® of real estate boards in Canada on a seasonally adjusted basis in June 2009. This is up 8.7 per cent from May and represents the first time since January 2008 that monthly activity topped 40,000 units. Actual (not seasonally adjusted) MLS® home sales climbed 17.9 per cent year-over-year to 54,616 units in June 2009. This is on par with the record for the month of June set in 2007 and is the fourth highest level for activity in any month on record. The national MLS® residential average sale price reached the highest quarterly level ever in the second quarter of 2009. At $318,696, the average sale price was up half a percent from the previous record set in the second quarter of 2008.
The national average home price also scaled new heights on a monthly basis, climbing 3.6 per cent year-overyear to $326,613 in June 2009. However, only 13 local markets posted new average price records in June, less than a handful of which are among the most active or expensive. The strong rebound in sales activity, not price, in Canada’s most expensive markets is skewing average prices upward nationally and in some provinces, just as a sharp decline in activity in these markets skewed the average lower in late 2008. MLS® home sales rebound in the second quarter The price trend is similar but less dramatic for the weighted national MLS® average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock.
The weighted national MLS® average sale price was up 1.7 per cent year-over-year in June 2009 – less than half of the percentage increase in the unweighted national average price. The supply of homes coming onto the MLS® market continued retreating in second quarter. Seasonally adjusted MLS® residential new listings were down 16.9 per cent from the previous quarter to 197,049 units, the lowest level since the fourth quarter of 2005.
Nationally, the number of months of inventory was 4.2 months in June 2009. This is the lowest level since August 2007, and well down from the recessionary peak of 12.8 months in January 2009. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity. The residential dollar volume for MLS® sales jumped 40.6 per cent on a seasonally adjusted quarter-over-quarter basis in the second quarter of 2009, to reach $34.8 billion.
“Low interest rates have improved the affordability of homeownership, as have price adjustments in housing markets that previously experienced rapid price increases,” said CREA Chief Economist Gregory Klump. “Housing markets where negotiations recently favoured the buyer have become more balanced and the stage is being set for modest price appreciation as inventories are drawn down by sales.” “Sales momentum remains strong going into the second half of 2009,” said CREA President Dale Ripplinger. “Chances are good that the number of transactions in the second half of 2009 will surpass levels in the first half of the year.”
Resale housing activity in Canada in February 2009 was up from seasonally adjusted levels the previous month, according to statistics released by The Canadian Real Estate Association (CREA).
A total of 28,669 homes traded hands via the Multiple Listing Service® (MLS®) nationally in February 2009 on a seasonally adjusted basis. This is 8.6 per cent above seasonally adjusted levels in January 2009, and the first monthly increase in activity since September 2008. Seasonally adjusted activity in February also surpassed levels reported in November and December of 2008.
Monthly seasonal increases in activity were largest in British Columbia (14.4 per cent), Nova Scotia (12.7 per cent), and Alberta (11.9 per cent). In Ontario and Quebec, the monthly rise was on par with the national increase.
“Typically the Spring market we’re moving into generates more activity, and this year there are the benefits from historically low mortgage rates and improved affordability in most markets,” says the President of The Canadian Real Estate Association, Calvin Lindberg. “REALTORS® are reporting increased interest especially from first time homebuyers.”
Actual (not seasonally adjusted) transactions numbered 25,373 units in February 2009. This was 31 per cent below MLS® residential sales levels a year earlier, but it is the smallest year-over-year decline since October 2008.
The supply of homes for sale remains high, but has been trending lower. National MLS® residential new listings numbered 65,060 units in February 2009, down 10.9 per cent from the same month one year ago. On a seasonally adjusted basis, MLS® residential new listings are down 11.4 per cent from their peak reached in May 2008.
“The housing supply is expected to continue easing, but it will take time before it realigns with lower demand,” said CREA Chief Economist Gregory Klump. “Economic uncertainty is keeping home buyers in a cautious mood, so homes are taking longer to sell than in recent years. Lower sales activity at the higher end of the price spectrum will keep the national MLS® residential average price under downward pressure.”
The national average price for home sales via the MLS® was $281,972 in February 2009, 9.2 per cent below February 2008. This is smaller than year-over-year declines observed in the past four months. It is also the first time that the year-over-year decline in the national average price has decelerated since first turning negative in July 2008.
The national MLS® residential average price continues to be pushed downward by lower activity in some of Canada’s more expensive housing markets and by fewer transactions in higher price ranges. The MLS® average home sale price remained up from year-ago levels in Saskatchewan, Manitoba, Quebec, New Brunswick, Prince Edward Island, and Newfoundland & Labrador in February 2009.
“Real estate is local, so it is important that buyers and sellers accurately determine pricing issues in their specific neighbourhood,” adds CREA President Calvin Lindberg, a West Vancouver REALTOR® .”Despite the doom and gloom, there are multiple offers on properties in some markets. That happens when the house is priced comparably to others in the area. Buyers are looking, but they are confused by the barrage of information they’re getting about the economy and the state of real estate. Consumer confidence remains a critical factor for the housing market.”
The downward pressure on the national MLS® residential average price is being skewed lower in large part by fewer sales in British Columbia, Alberta and Ontario, where homes are more expensive and demand has softened most. MLS® home sales in these three provinces accounted for 66 per cent of national activity in February 2009, down from 69 per cent in 2008.
The price trend is similar but less dramatic for the weighted national MLS® average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock. The weighted national MLS® average sale price was down 5.3 per cent year-over-year in February, compared to a 6.1 per cent decline in January.
Seasonally adjusted residential dollar volume for MLS® sales totaled $8 billion in February 2009, an increase of 7.2 per cent from the previous month.
“Consumer confidence will continue to be depressed by a barrage of negative economic news in the months ahead,” said Klump. “Heightened job insecurity will keep many potential homebuyers on the sidelines. Those who are confident about their job situation will benefit from improving affordability in a number of housing markets.”
PLEASE NOTE: The information contained in this news release combines both major market and national MLS® sales information from the previous month. The Canadian Real Estate Association has previously released these separately.
CREA cautions that average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighborhoods or account for price differential between geographic areas. Statistical information contained in this report includes all housing types.
MLS® is a co-operative marketing system used only by Canada’s real estate Boards to ensure maximum exposure of properties listed for sale.
The Canadian Real Estate Association (CREA) is one of Canada’s largest single-industry trade associations, representing more than 98,000 REALTORS® working through more than 100 real estate Boards and Associations. Further information can be found at www.crea.ca.
OTTAWA – February 9th, 2009 – National MLS® home sales activity is expected to decline in 2009 before rebounding in 2010, according to a new residential housing forecast prepared by The Canadian Real Estate Association. National MLS® home sales activity declined 17.1 per cent in 2008, and MLS® sales activity is forecast to fall an additional 16.9 per cent to 360,900 units in 2009.
This would be the lowest level for national sales activity since the year 2000. Sales activity is expected to decline from levels set in 2008 in every province, led by declines in British Columbia, Alberta and Ontario.
National MLS® home sales activity is forecast to rebound by 9.9 per cent to 396,600 units in 2010, marked by an acceleration in activity in the second half of that year. The rebound in activity in 2010 is forecast to be biggest in British Columbia and Alberta.
New listings on the MLS® systems of real estate Boards in Canada have been trending steadily lower since peaking in the second quarter of 2008, and that trend is forecast to continue. It is that combination of rebounding sales activity and fewer new listings that will stabilize the MLS® resale housing market in 2010. “We are caught in a cycle where consumer confidence has been eroded because of job losses, and consumer confidence is an essential ingredient for housing sales activity,”says the President of The Canadian Real Estate Association, Calvin Lindberg of Vancouver. “And housing activity helps creates jobs.”
“The essential selling ingredients in today’s market are realistic pricing, marketing, and preparation. There are potential buyers making inquiries, but the barrage of economic news makes them much more cautious than before.”
The MLS® sales forecast developed by CREA Chief Economist Gregory Klump shows that fewer transactions in some of Canada’s more expensive housing markets, combined with reduced asking prices, will continue to put downward pressure on average MLS® sale prices.
The national MLS® average home price is forecast to decline eight per cent in 2009, with prices down most in Western provinces and Ontario. By contrast, the average home price in Newfoundland & Labrador is forecast to rise 4.8 percent in 2009. Prices are forecast to stabilize in 2010, with annual price increases of one per cent or less in five provinces.
The price trend is similar but less dramatic for the weighted national MLS® average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock. The weighted national MLS® average price is forecast to decline 6.4 per cent in 2009, and hold steady in 2010.
“Increasingly cautious homebuyers and mortgage lenders means that active listings will take longer to sell in 2009 compared to previous years,” said CREA Chief Economist Gregory Klump.
“The national housing market is recalibrating due to weak sales activity,” said Klump. “Supply will take time to adjust to lower demand, but sellers unwilling to accept offers below their expectations will remove their home from the market,” he added. “Fewer active listings reduces buyer choice, and in time puts a floor under prices,” CREA’s Chief Economist added.
REALTORS® welcome federal housing initiatives in stimulating Canadian economy
The Canadian Real Estate Association (CREA) welcomes the federal government initiatives to stimulate economic growth outlined in the 2009 budget, especially those that will encourage home ownership in Canada. The Association applauds the government for recognizing the economic importance of the housing industry in some of the budget measures.
“The change announced to the popular Home Buyers’ Plan will help Canadians who want to own their own home, and do it in a responsible way that is not a major drain on taxpayers,” says the President of The Canadian Real Estate Association (CREA), Calvin Lindberg.
Research conducted for CREA by the Altus Group shows that each residential real estate transaction in Canada generates $32,200 in ancillary consumer spending. The study also reported that 94,700 full time direct jobs were generated annually by that ancillary or spin-off activity. The study is posted on the www.crea.ca website.
“The federal government has found a way to introduce economic stimulus and housing initiatives for specific groups, and for Canadians who want to buy their first home.” Mr. Lindberg added. CREA had proposed the federal government do that by increasing the limit of the Home Buyers’ Plan (HBP) to help stimulate the housing market.
Introduced in 1992 by a Conservative government and made permanent by a Liberal government in 1994, the HBP has broad political and consumer support. It will now allow first time homebuyers to withdraw up to $25,000 from their RRSP to be used in a down payment on a residential property. The Plan has not had the same impact and relevance it did 16 years ago, when the original $20,000 limit represented 13.3 per cent of the average house price, versus about 6.5 per cent in 2008.
The Association also believes that the success of the proposed home renovation tax credit program will depend on effective administration and promotion. “The use of tax credits will make the program of interest to many Canadians who own their own home,” adds the CREA President, “but the success will be tied in part to the availability of savings or credit, since the expense has to be paid before the tax credit is issued.”
A survey conducted for CREA by IPSOS Reid in October 2008 revealed that only 12 per cent of homeowners had ever applied to some type of government renovation or energy efficiency program. In that same survey, 36 per cent said they would consider replacing windows as a priority to improving home energy efficiency, while another 27 per cent said it would be adding insulation. The Canadian Real Estate Association (CREA) also welcomes federal government initiatives that will encourage home ownership and better communities in Canada.
“The announced measures for aboriginal and social housing are welcomed by REALTORS® as steps to help house those who may be in need, and to modernize existing housing resources,” adds CREA President Calvin Lindberg.
CREA first called on governments to address various issues affecting native home ownership during the World Urban Forum in Vancouver in 2006. The Association’s analysis of native housing issues is available in a booklet posted on the www.crea.ca website. “The budget spending initiatives help address the issue of the quality of native housing, and quality of life on Canadian reserves. Equally as important is the transition to market-based housing on reserves, and the government in the budget has committed to the transition to that as well,” adds Mr. Lindberg.
I was born right here in Calgary and have been a full-time member of the Calgary Real Estate Board since April of 2000. I consistently outperform the industry averages and am a member of CIR Realty's "Executive Platinum Award Club", a notable achievement which is approximately equivalent to the Real Estate Boards MLS® Million Dollar Award Club.
