MLS® home sales activity will continue cooling trend
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In line with the recent downward revisions of Canadian economic and job growth forecasts, CREA is updating its MLS® housing market forecast for the balance of 2008, and 2009. National home sales activity is now forecast to decrease by 12% to 461,200 units in 2008, and decrease by 3% in 2009. The number of new listings is forecast to decline further from the peak reached in the second quarter of 2008, with levels in 2009 on par with levels in 2007. Fewer new listings will stabilize the resale housing market in 2009. Average home prices will reach new heights in nearly all provinces in 2008, but declining activity in higher priced markets will hold the national average price stable this year compared to 2007. The national average price is forecast to ease by 2.1 per cent in 2009.
Canadian economic growth is forecast to start improving in the second half of 2009 before accelerating in 2010. Re-aligning housing market balance and improving home affordability will set the stage for an improving housing market in 2010.
“Canadians are definitely concerned by the economic news out of the US, and much of that news stems from distress in the US housing market. Canadians should realize that Canada’s economy and housing market are both in better shape. This means the downturn in Canadian consumer confidence will pass and when it does, housing demand will rebound, especially when they realize the window of opportunity to buy at reduced prices and at low interest rates will begin to narrow once economic growth shows signs of rebounding next year.”
A brief video broadcast about this housing market information featuring CREA President Calvin Lindberg and CREA Chief Economist Gregory Klump are available on www.crea.ca.
