Prices are expected to fall in 2009 and then rebound slightly in 2010
Garry Marr
Sun
The average price of homes sold in 2009 is expected to decline slightly, then recover in 2010. Photograph by: Steve Bosch, Vancouver Sun, Files, Financial Post
Housing sales this year are expected to drop back to 2000 levels, according to a new report from the Canadian Real Estate Association.
The Ottawa-based group, which represents 100 boards across the country, issued a new forecast for 2009 on Monday and predicted sales would fall to 360,900. That would be a 16.9 per cent decline from 2008.
“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,” said Calvin Lindberg, president of CREA.
His group is forecasting a rebound by 2010 and forecasts sales to jump to 9.9 per cent then, with most of the growth coming in the second half of that year. B.C. and Alberta are expected to have the strongest rebounds in 2010.
Prices are also forecast to fall this year before rebounding slightly in 2010. CREA said the average price of homes sold in Canada will be $279,400 this year, an eight per cent decline from last year.
In 2008, the average sale price in Canada dropped 0.7 per cent.
The increase in price is forecast to be modest next year. CREA said the average sale price of a home next year will be $282,400, a 1.1-per-cent increase from 2009.
“Increasingly, cautious homebuyers and mortgage lenders mean that active listings will take longer to sell in 2009 compared to previous years,” said Gregory Klump, chief economist with CREA.
“The national housing market is recalibrating due to weak sales activity.”
© Copyright (c) The Vancouver Sun
