Home sales, prices see double-digit drops

Home sales, prices see double-digit drops

Eric Beauchesne,

Published: Monday, December 15, 2008

OTTAWA - Home sales suffered their second straight double-digit plunge last month to a near eight-year low, while average home prices fell almost 10 per cent from a year earlier, according to an industry report Monday, providing the latest evidence of a sharper-than-expected downturn in the domestic housing market.


Sales in November fell 12.3 per cent from October to the lowest level since January 2001, with 85 per cent of cities reporting a drop, the Canadian Real Estate Association said.

Sales in November fell 12.3 per cent from October to the lowest level since January 2001, with 85 per cent of cities reporting a drop, the Canadian Real Estate Association said.

Sales in November fell 12.3 per cent from October to the lowest level since January 2001, with 85 per cent of cities reporting a drop, the Canadian Real Estate Association said.


Shannon Stapleton/Reuters


"The report underscores that the Canadian housing correction continued in earnest . . . ," said TD Securities analyst Millan Mulraine. However, that the drop in sales in November was slightly less than the drop in October, which "does offer a silver-lining ... albeit marginal," Mulraine said.


Meanwhile, the average prices of a home was down 9.8 per cent in November from a year earlier, the industry association said.


"The housing market reflects the economic reality in Canada," said CREA president Calvin Lindberg, noting that the decline in housing activity this year translates into $2.8 billion less in spinoff consumer spending.


However, CREA said the year-over-year declines in the average home price were reported in fewer than half of all markets, a drop in sales and a decline in average prices in Canada's priciest housing markets - especially in British Columbia, Alberta and Ontario - weighing on the overall average price.


In fact, year-over-year declines in prices were limited to a handful of higher-priced centres - Greater Vancouver, Victoria, Calgary, Edmonton, Oshawa and Toronto, it said.


"These changes in the Canadian housing market reflect a broader and weakened picture of both the economy and buyer sentiment," said the industry association's chief economist Gregory Klump.


"National sales activity and price trends will continue reflecting increased cautiousness on the part of lenders and buyers, as the economy works its way through and out of the current recession."


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