Down goes the housing market

By Erica Alini - Tuesday, January 15, 2013 at 10:13 AM - 0 Comments

Nathan Denette/The Canadian Press

To recap:

• Sales of existing homes in Canada dipped 0.5 per cent nationally in December from November in seasonally adjusted terms, the Canadian Real Estate Association said today. It was the the third consecutive month of declines.
• Actual, non-seasonally adjusted sales, dropped 17.4 per cent compared to December 2011.
• CREA’s MLS home-price index rose 3.3 per cent on a year-over-year basis, the smallest gain since April 2011.
• The number of homes newly listed for sale in December fell 1.3 per cent from November. Greater Toronto recorded the largest drop in new listings.
• Four of every five local markets recorded sales declines in December on a year-over-year basis. Calgary was the great exception, with December sales up seven per cent year-over-year.

Commentary:

• Sales numbers are moving exactly the way Finance Minister Jim Flaherty wants them to. “I don’t mind prices coming down a bit, too,” he told the Globe and Mail.
• There’s little doubt the sales plunge reflects the impact of the mortgage-tighnening rules introduced by the federal government in July, TD Economics’ Sonya Gulati wrote in a note to clients this morning. Still, it might be too early to say whether the finance minister has effectively tamed the housing market: Gulati notes that the impact of the new mortgage legislation is now likely fully priced in, and that the cooling effects of similar tightenings in the past have been only temporary.

Canada’s housing market: is it a cooling? Is it a crash?

By Erica Alini - Wednesday, October 31, 2012 at 9:00 AM - 0 Comments

Last Friday, rating agency Moody’s announced that almost all of Canada’s biggest banks might be in for a credit downgrade, citing “concerns about high consumer debt levels and elevated housing prices.” It was just the latest warning that, after soaring for 14 years, Canada’s housing market might be finally headed back to Earth.

Now, virtually everyone—from the Bank of Canada and the Finance Department through Canada’s banks to the International Monetary Fund and independent analysts—agrees that housing is losing steam and Canadian wallets are overstretched.

But is Canada’s housing market headed for a gracious landing or a face-forward crash? When it comes to predicting how rough a ride it will be, opinions vary widely.

To help Maclean’s readers make up their minds, we’ve compiled a review of prominent arguments supporting bullish and bearish positions on four key questions about the future of Canada’s real estate and what it all means:

Continue…

Canadian housing market continues to lose steam

By The Canadian Press - Wednesday, August 15, 2012 at 12:45 PM - 0 Comments

TORONTO – Home sales across the country declined marginally last month, continuing a recent trend toward a gradual cooling in what had been a red hot market, according to the Canadian Real Estate Association.

Overall, CREA said Wednesday resale housing numbers were down just 0.01 per cent in July compared with June, although non-seasonally adjusted sales were up 3.3 per cent last month compared with July 2011.

And, although prices were above year-ago levels in about seven of every 10 local markets, falling sales in Greater Vancouver drove the national average lower.

The Canadian average price for homes sold in July 2012 was $353,147, down two per cent from the same month last year. Excluding Greater Vancouver from the calculation, the average was up 1.1 per cent from a year ago.

Continue…