OTTAWA — The Canadian Real Estate Association cut its sales forecast for this year and next  as it reported slower sales for November in the wake of tighter lending rules that came into force in summer.

The industry association now expects home sales this year to slip 0.5 per cent compared with 2011 to about 456,300.

That compared with a forecast in September that called for sales this year to rise 1.9 per cent to 466,900 units.

CREA also said it now expects sales next year to drop two per cent to 447,400 compared with earlier expectations for a drop of 1.9 per cent to 457,800 in 2013.

MORTGAGE RULE CHANGES

“Annual sales in 2012 reflect a stronger profile prior to recent mortgage rule changes followed by weaker activity following their implementation,” said Gregory Klump, CREA’s chief economist.

“By contrast, forecast sales in 2013 reflect an improvement from levels this summer in the immediate wake of mortgage rule changes. Even so, sales in most provinces next year are expected to remain down from levels posted prior to the most recent changes to mortgage regulations.”

Finance Minister Jim Flaherty moved in July to tighten mortgage rules for the fourth time in as many years in order to discourage Canadians from taking on too much debt. Among the changes, Flaherty made mortgage payments more expensive by dropping the maximum amortization period to 25 years.

EXPECTATIONS ADJUSTED

CREA said the average price for 2012 is expected to be $363,900, up 0.3 per cent compared with a September forecast of $365,000, up 0.6 per cent.

For 2013, CREA said it expects prices to gain 0.3 per cent to an average $365,100. That compared with earlier expectations of a drop of one tenth of one per cent to $364,500 in 2013.

The downgrade for the outlook for the year came as home sales edged down 1.7 per cent month over month in November and were back where they stood in August. The decrease followed a drop of about one-tenth of a per cent in September.

POLICY-INDUCED CHANGE

BMO deputy chief economist Doug Porter said for all the attention it has received, the market’s performance has been far from exciting this year.

“It increasingly looks like most major markets are indeed undergoing a policy-induced correction,” Porter wrote in a note to clients.

“But, for now, the landing looks to be soft in most cities, with the rather obvious exception of Vancouver.”

‘POTENTIALLY SEVERE’

However, economist David Madani of Capital Economics said the belief that the Canadian market was enjoying a “soft landing” because prices have not fallen sharply was misplaced.

“The continued decline in existing home sales support(s) our view that a potentially severe housing correction is underway,” Madani said.

“Assuming that sales continue to trend lower heading into next year, then sharper demand and supply imbalances will eventually lead to widespread home price declines. We still think that house prices will decline by 25 per cent over the next year or two.”

OVERALL DECLINE IN SALES

Actual, or non-seasonally adjusted sales, were down 11.9 per cent from November 2011 while the national average home price in November was $356,687, off 0.8 per cent from November 2011.

Sales were down on a year-over-year basis in three of every four local markets in November, including most large urban centres. Calgary stood out as an exception, with sales up 10.6 per cent from a year ago.

Toronto, Montreal and Vancouver contributed most to the small decline at the national level.

PRICES UP 3.5 PER CENT

A total of 432,861 homes have traded hands over the MLS system so far this year, down 0.2 per cent from levels reported over the first 11 months of 2011 and 0.8 per cent below the 10-year average for the period.

The MLS Home Price Index, which is not affected changes in the mix of sales, showed prices up 3.5 per cent nationally on a year-over-year basis in November.

However, it was the seventh consecutive month in which the year-over-year gain shrank and marked the slowest rate of increase since May 2011.

VANCOUVER BUCKS TREND

The MLS HPI rose fastest in Regina, up 11.6 per cent year over year in November, though down from 13 per cent in October.

Among other markets, the HPI was up 4.6 per cent year over year in Toronto, 1.9 per cent in Montreal and 7.1 per cent in Calgary. In Greater Vancouver, the HPI was down 1.7 per cent year over year.

Post CommentComments: 0Read Full Story

Where: Richmond Nature Park
11851 Westminster Hwy, Richmond, BC
When: Sun., Dec. 10, 2006 5:30 PM
To: Sat., Dec. 30, 2006 9:30 PM
Cost: Admission by donation 

Nature is the theme where over 150,000 lights illuminate the pond and highlight the whimsical antics of animals in winter. Warm up with hot chocolate, enjoy live entertainment Friday-Sunday evenings.

Post CommentComments: 0Read Full Story

Vancouver Christmas Market

  • Location: Vancouver Christmas Market
  • Address: Queen Elizabeth Theatre Plaza, Vancouver, BC
  • Recurring daily


Step back in time ... Experience the Vancouver Christmas Market! The Vancouver Christmas Market is back for its third year from November 24 to December 24, 2012 on the Queen Elizabeth Theatre Plaza! Check out our most exciting news: You pay admission once and enter the whole season for free! Sample our new delicious food items and find your unique Christmas gift! Enjoy seasonal music and a great entertainment program of authentic folk groups! Tickets to the Vancouver Christmas Market will be ... Visit Website

Post CommentComments: 1Read Full Story

Canadian housing starts continued to moderate in November, falling from 204K units at a seasonally adjusted annual rate (SAAR) in October, to 196,125 (SAAR).  New home construction in BC urban centres also declined, falling to 22,300 (SAAR) in November from 26,700 units (SAAR) in October.  On a year-over-year basis, multiple unit starts in BC were 14 per cent lower in November while single family starts were 20 per cent lower. Overall,  BC housing starts were 15 per cent lower than in November 2011 but remain 5 per cent higher year-to-date compared with 2011.

Looking at census metropolitan areas (CMA) in BC, Vancouver CMA starts fell 27 per cent year-over-year in November. Both the single-detached and multiples sector fell over 20 per cent compared with November 2011. New home construction in the Abbotsford CMA was off 43 per cent compared to 2011 due to relatively slow activity in multiple starts. Housing starts in the Kelowna CMA rose 9 per cent year- over-year as a jump in multiple starts offset sagging single-detached construction. Housing starts in Victoria were 64 per cent higher than November 2011 as multiple unit starts more than doubled November 2011 levels. Victoria single starts were off 20 per cent year-over-year.

Post CommentComments: 0Read Full Story

Following the surprise announcement that Mark Carney will be departing to helm the Bank of England, it was back to business as usual at the Bank of Canada as interest rates were once again held constant at 1 per cent. The statement released this morning in support of the interest rate decision noted that while the global economy appears to have stabilized, it still remains vulnerable to major shocks from the US or Europe. The Canadian economy is growing at a slightly softer pace than the Bank expected, but is forecast to pick up in 2013.   On inflation, the Bank sees core inflation returning to its 2 per cent target over the next 12 months.

The Bank once again noted that a gradual withdrawal of monetary stimulus would likely be required, though the timing of such withdrawal would be weighed against global and domestic developments including the evolution of household imbalances. We continue to forecast a 25 basis point increase in the Bank's overnight target rate occurring in mid-to-late 2013.

Post CommentComments: 0Read Full Story