The following is an excerpt from the Canadian Real Estate Association's (CREA) November 10th News Release.
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. Canada wide, the number of new listings is forecast to decline further from the peak reached in the 2nd quarter of 2008, with levels in 2009 on par with 2007. Fewer new listings will stabilize the resale housing market in 2009.
Consumer confidence is being battered by downbeat headline news. Homebuyers sentiment has become very cautious, in contrast to the urgency to purchase in 2007. There are fewer buyers and they are taking longer to shop, so the pricing environment is very competitive. Unrealistically priced homes will sit on the market. Sellers are, by and large, under no distress to sell. Those who put their home on the market at an unrealistic price and are unwilling to cut it, will likely take it off the market when the listing expires with a view to selling another day.
The projected decline in new MLS listings will prevent an oversupply of homes available for sale in the Canadian housing market. This stands in stark contrast to the U.S. housing market which is significantly oversupplied.
Canadians are definitely concerned by the economic news out of the U.S. and much of that news stems from distress in the U.S. housing market. Canadians should realize that Canada's economy and housing markets are both in better shape. This means the downturn in Canadian consumers' 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 low interest rates will begin to narrow once economic growth shows sign of rebounding next year.
More specifically for Toronto, the Toronto Real Estate Board's (TREB) month-end report shows in October that the GTA experienced a 38% decline in volume of sales and a 10% price decline compared to last year.
However a quick look at the following TREB statistics shows that only 3 of the central regions of GTA experienced an average price decline compared to 2007 !
Year-To-Date Data as of October 31st
2007 Averages 2008 Averages Yr over Yr
$ Sale DoM $ Sale DoM Change
C01 346,633 25 372,232 25 6.9%
C02 691,040 25 718,659 24 3.8%
C03 838,158 26 766,785 28 -9.3%
C04 693,275 24 712,624 27 2.7%
C08 343,316 23 364,478 22 5.8%
C09 1,098,944 25 998,182 24 -10.1%
C10 706,264 18 679,887 21 -3.9%
C11 484,290 28 521,224 27 7.1%
C12 1,279,546 32 1,302,872 32 1.8%
E01 406,265 17 443,668 18 8.4%
E02 490,931 16 523,610 16 6.2%
E03 352,960 23 370,580 24 4.8%
W01 446,809 22 471,828 24 5.3%
W02 430,720 20 469,037 21 8.2%
DoM = Days on Market
