--CREA Forecasts Very Slight Rise Home Resales Nationally in 2012
--Sees 0.3% Sales Drop in 2013, No Real Boost In Prices
OTTAWA (MNI) - Canada housing activity is subsiding from the overheated pace of sales and prices in some national hot spots, but it is a slow drop without any large correction, keeping the national sales pace essentially flat, the Canadian Real Estate Association said in its quartely outlook Monday.
CREA projects national existing home sales 458,800 units in 2012, up just 0.3% from 457,305 last year, driven largely by an expected 2.0% decline in Ontario -- Canada's largest province with more than a third of the population -- to 196,300 units from 200,323 in 2011.
For 2013, CREA forecasts sales to fall by 0.3%, with very slight gains in most provinces offset by a 1.7% decline to 192,900 units in Ontario.
Ontario, in the industrial heartland of Canada, has been suffering large manufacturing employment losses since the 2008 recession and considerable emigration of residents to resources-booming Western Canada.
CREA expects the national average home price to fall 1.1% in 2012 to C$359,100 (US$359,100). In the country's hottest spot, the West Coast province of British Columbia, average prices have been far above those of the rest of Canada, but are expected to drop 4.0% this year to $539,000 from C$561,304 in 2011, and then rise very slightly to $541,800 for 2013.
In Ontario, on the other hand, where Toronto-area condominium starts and sales have been another hotspot, raising home prices overall, CREA expects that to fall slightly to $364,000 this year from an average of $366,390 in 2011, and to not-quite recover in 2013 to $365,800.
After British Columbia, Ontario and Alberta, with an average of $353,390 in 2011, home prices across Canada are markedly lower and, according to CREA, are unlikely to rise greatly.
"Multi-million dollar sales activity in Vancouver caused the national average price to temporarily spike in early 2011," CREA said in a statement. "This phenomenon is not expected to recur in 2012."
Despite considerable debate by analysts and the Bank of Canada and the Finance Department about hot housing activity and an increasing burden of household debt, brought about in good part by prolonged historically low interest rates, CREA said national home sales activity for 2012 and 2013 "is projected to remain roughly on par with the 10-year average for annual activity."
"Risks to the Canadian economic outlook remain elevated owing to the European sovereign debt quagmire, but the continuation in low interest rates is the silver lining," said CREA chief economist Gregory Klump, noting low interest rates would continue to support Canadian home sales and prices.
Klump, however, indicated a caution along with his confidence, about those low interest rates --- just before the Bank of Canada issues a policy interest rate decision on Thursday, when it is widely expected to continue with the 1.0% rate that it has maintained for more than a year.
"Recent trends are reassuring, but interest rates remaining low for longer with doubtless keep the Canadian housing market under scrutiny for signs of overheating," he said.
** Market News International Ottawa **
Source: https://mninews.deutsche-boerse.com/index.php/canada-real-estate-assnhotspot-home-sales-subside-slightly?q=content/canada-real-estate-assnhotspot-home-sales-subside-slightly
No comments:
Post a Comment