Housing sales across Canada are set to reach new highs

TORONTO - November housing sales across the country are set to reach new highs based on fresh data from the country’s two most expensive markets.
The national numbers from the Ottawa-based Canadian Real Estate Association are not due out until mid-December but the Toronto Real Estate Board said yesterday it had its best November on record. Toronto’s news came on the heals of a Wednesday release from the Real Estate Board of Greater Vancouver that said sales activity in the city rocketed up 252.7% in November from a year ago.
What the latest numbers will likely mean is an improvement in the national average sale price, which was up 20% in October from a year ago — the largest such increase in two decades. The two cities tend to skew the national average price up or down, based on levels of sales activity.
“You are going to see a very strong national number. It will be another double-digit increase for sure,” said Benjamin Tal, senior economist at CIBC World Markets. “You have to remember you are comparing all this against a very low base. Last year at this time we were talking about 1929. This was a dead market.”
In November 2008, the greater Vancouver area had a meagre 874 sales. This November that figure was up to 3,083. But there are some indications the temperature in the red-hot housing market is dropping; Vancouver November sales were down 16.8% from October, although the numbers are not seasonally adjusted.
Toronto has a similar story to Vancouver. Canada’s largest market had 7,446 sales last month, almost double the number from a year ago, but down from the 8,476 in October.
Despite the lack of listings in the housing market, prices eased last month. The average sale price in Toronto last month was $418,460, a 14% jump from a year ago, but a drop from therecord high of $423,559 reached in October.
In Vancouver, the average price of a home reached $557,384 last month, a 12.4% increase from a year ago. But at that level, prices in Vancouver are actually down 1.9% from the peak reached in May 2008.
Re/Max, one of the country’s largest real-estate companies, issued its housing outlook for 2010 and though it still sees a strong market, both housing sales and prices are not expected to maintain their torrid pace. Re/Max says sales next year will climb by 2% while the average sale price across the country will rise to $325,000 for a 2% increase.
“There is a ton of business being done but nothing was being done in November [2008]. The whole world stopped last fall, not just the real-estate world,” said Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada. “We should expect a very good year with a continued high number of sales. We don’t expect significant changes in interest rate levels.”
Record low interest rate levels have partially fuelled the market and prices, but so have low inventory levels. In Toronto, inventory levels remain 49% down from a year ago with November 2009 new listings the same as a year ago. In Vancouver, the total number of listings is still down 39% from a year ago.
As for the interest-rate part of the puzzle, the Canadian Association of Accredited Mortgage Professionals latest statistics show consumers could find themselves exposed. In the past 12 months, only 20% of consumers opted for a variable-rate product but the overall numbers show 27% of Canadians still have mortgage tied to prime. “There is no questions rates and affordability have contributed to the market,” said Jim Murphy, president of CAAMP.
Financial Post

Posted via web from Veronica Campbell

Housing sales across Canada are set to reach new highs

TORONTO - November housing sales across the country are set to reach new highs based on fresh data from the country’s two most expensive markets.
The national numbers from the Ottawa-based Canadian Real Estate Association are not due out until mid-December but the Toronto Real Estate Board said yesterday it had its best November on record. Toronto’s news came on the heals of a Wednesday release from the Real Estate Board of Greater Vancouver that said sales activity in the city rocketed up 252.7% in November from a year ago.
What the latest numbers will likely mean is an improvement in the national average sale price, which was up 20% in October from a year ago — the largest such increase in two decades. The two cities tend to skew the national average price up or down, based on levels of sales activity.
“You are going to see a very strong national number. It will be another double-digit increase for sure,” said Benjamin Tal, senior economist at CIBC World Markets. “You have to remember you are comparing all this against a very low base. Last year at this time we were talking about 1929. This was a dead market.”
In November 2008, the greater Vancouver area had a meagre 874 sales. This November that figure was up to 3,083. But there are some indications the temperature in the red-hot housing market is dropping; Vancouver November sales were down 16.8% from October, although the numbers are not seasonally adjusted.
Toronto has a similar story to Vancouver. Canada’s largest market had 7,446 sales last month, almost double the number from a year ago, but down from the 8,476 in October.
Despite the lack of listings in the housing market, prices eased last month. The average sale price in Toronto last month was $418,460, a 14% jump from a year ago, but a drop from therecord high of $423,559 reached in October.
In Vancouver, the average price of a home reached $557,384 last month, a 12.4% increase from a year ago. But at that level, prices in Vancouver are actually down 1.9% from the peak reached in May 2008.
Re/Max, one of the country’s largest real-estate companies, issued its housing outlook for 2010 and though it still sees a strong market, both housing sales and prices are not expected to maintain their torrid pace. Re/Max says sales next year will climb by 2% while the average sale price across the country will rise to $325,000 for a 2% increase.
“There is a ton of business being done but nothing was being done in November [2008]. The whole world stopped last fall, not just the real-estate world,” said Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada. “We should expect a very good year with a continued high number of sales. We don’t expect significant changes in interest rate levels.”
Record low interest rate levels have partially fuelled the market and prices, but so have low inventory levels. In Toronto, inventory levels remain 49% down from a year ago with November 2009 new listings the same as a year ago. In Vancouver, the total number of listings is still down 39% from a year ago.
As for the interest-rate part of the puzzle, the Canadian Association of Accredited Mortgage Professionals latest statistics show consumers could find themselves exposed. In the past 12 months, only 20% of consumers opted for a variable-rate product but the overall numbers show 27% of Canadians still have mortgage tied to prime. “There is no questions rates and affordability have contributed to the market,” said Jim Murphy, president of CAAMP.
Financial Post

Kelowna Housing prices predicted to rise in 2010

The real estate market in Kelowna is expected to make a healthy recovery in 2010.
According to a report released Thursday by REMAX, house prices in Kelowna will increase about 5 per cent in 2010.
Property values in Kelowna fell marginally this year.
The report goes on to say the major front runners in terms of unit sales appreciation in 2010 are all in Western Canada, led by Kelowna with an anticipated upswing of 10 per cent in housing sales.
"Some of the greatest percentage gains were reported in Western Canadian markets in 2009, demonstrating the higher the peak the lower the valley," says Regional Executive Vice-President, Elton Ash.
"That said, the recession barely registered on year-over-year activity in most major centres."
The report further states that nationally, the average price of a home is expected to rise to $325,000 by the end of 2010, the highest level in Canadian history.

Posted via web from Veronica Campbell

Kelowna Housing prices predicted to rise in 2010

The real estate market in Kelowna is expected to make a healthy recovery in 2010.

According to a report released Thursday by REMAX, house prices in Kelowna will increase about 5 per cent in 2010.

Property values in Kelowna fell marginally this year.

The report goes on to say the major front runners in terms of unit sales appreciation in 2010 are all in Western Canada, led by Kelowna with an anticipated upswing of 10 per cent in housing sales.

"Some of the greatest percentage gains were reported in Western Canadian markets in 2009, demonstrating the higher the peak the lower the valley," says Regional Executive Vice-President, Elton Ash.

"That said, the recession barely registered on year-over-year activity in most major centres."

The report further states that nationally, the average price of a home is expected to rise to $325,000 by the end of 2010, the highest level in Canadian history.

Retirees and the upper middle class slowed Kelowna’s real estate crash; rebound

 

By Kathy Michaels

Kelowna’s real estate market is showing signs of stability despite continued economic tumult nationwide, but as this year comes to an end, local home values will have dropped while other B.C. cities post gains, according to the RE/MAX Housing Market Outlook for 2010

“It’s a unique experience this time around,” said Elton Ash, the regional executive vice president of Re/Max Western Canada. “In 2008 the real estate market was strong in the first six months and there were double digit price increases. Then in the last quarter there was a 20 per cent decrease … so all in all when you took the first part with the end of year  it was zero effect. This year the price decreases continued into  2009, but now we’re seeing the market strengthening and that’s all in three to five per cent decrease.”

While stability was the focus of the report, Ash noted that other B.C. cities like Vancouver and Victoria did see gains on par with this region’s losses. That, he said, can be attributed to Kelowna’s economic base which is less diversified than a larger urban centre. When Vancouver and Victoria hit a bump, it’s never as dramatic as it is in the Okanagan.

“This is historically the trending,” he said. “Kelowna sees a greater price depreciation when the price changes… it’s not surprising.”

What seems to have saved the region from further losses, he said, is the population composition and how they reacted to the crash last year.

“Being a retirement destination, with a lot of upper middle income earners, the equity to loan ratio is higher,” he said. “So when we experienced the price drops from a year ago, people decided they wouldn’t sell.”

In the first quarter of this year, those who were initially looking to sell pulled their houses off the market and that kept the inventory low. When supply was diminished it drove prices up again and first time buyers started to eat through the supply that remained. Their demand combined with a little less supply lessened the downward cycle of prices and brought the market to more balanced conditions.

That’s helping put Kelowna in good stead for 2010. In the Market Outlook report, 23 other major markets were also examined and this city was highlighted as an area that will see growth in the year ahead. What’s expected to be a 10 per cent increase in sales volume will put upward pressure on pricing and Ash said he expects to see the average price of a home rise to $438,000 next year from an estimated high of $417,000 by the end of this year. At the end of 2008, the average house price was $430,000.

“The important thing is that Canadians are confident in the economy and the banking system, and that’s driving quicker recovery,” he said. “The economic fundamentals in place going forward ideally position the ten provinces, and the sector overall, for further growth.”

A number of factors will help prop up activity going forward, including improved economic conditions, continued low interest rates, rising consumer confidence and solid capital spending which will buoy employment. Inventory will once again assume the wildcard role, with any decline placing upward pressure on prices. Multiple offers will remain the exception in most markets, more commonplace on quality entry-level product which remains in tight supply.

The report found that sales are forecast to recover in almost all major centres by year-end 2009, led by an anticipated 45 per cent increase in Greater Vancouver. Two markets —Ottawa and Quebec City —are expected to hit historic highs in the number of homes sold. Average price should post new records in 65 per cent of markets surveyed this year. As economic performance ramps up across the country, so too will residential real estate.  Eighty-three per cent of markets (19/23) are expecting sales to increase over 2009 levels while housing values are forecast to escalate in 91 per cent (21/23) of Canadian centres in 2010.  The remaining markets will match 2009 levels.

Posted via web from Veronica Campbell

Retirees and the upper middle class slowed Kelowna’s real estate crash; rebound predicted

Retirees and the upper middle class slowed Kelowna’s real estate crash; rebound predicted

 
By Kathy Michaels
Kelowna’s real estate market is showing signs of stability despite continued economic tumult nationwide, but as this year comes to an end, local home values will have dropped while other B.C. cities post gains, according to the RE/MAX Housing Market Outlook for 2010
“It’s a unique experience this time around,” said Elton Ash, the regional executive vice president of Re/Max Western Canada. “In 2008 the real estate market was strong in the first six months and there were double digit price increases. Then in the last quarter there was a 20 per cent decrease … so all in all when you took the first part with the end of year  it was zero effect. This year the price decreases continued into  2009, but now we’re seeing the market strengthening and that’s all in three to five per cent decrease.”
While stability was the focus of the report, Ash noted that other B.C. cities like Vancouver and Victoria did see gains on par with this region’s losses. That, he said, can be attributed to Kelowna’s economic base which is less diversified than a larger urban centre. When Vancouver and Victoria hit a bump, it’s never as dramatic as it is in the Okanagan.
“This is historically the trending,” he said. “Kelowna sees a greater price depreciation when the price changes… it’s not surprising.”
What seems to have saved the region from further losses, he said, is the population composition and how they reacted to the crash last year.
“Being a retirement destination, with a lot of upper middle income earners, the equity to loan ratio is higher,” he said. “So when we experienced the price drops from a year ago, people decided they wouldn’t sell.”
In the first quarter of this year, those who were initially looking to sell pulled their houses off the market and that kept the inventory low. When supply was diminished it drove prices up again and first time buyers started to eat through the supply that remained. Their demand combined with a little less supply lessened the downward cycle of prices and brought the market to more balanced conditions.
That’s helping put Kelowna in good stead for 2010. In the Market Outlook report, 23 other major markets were also examined and this city was highlighted as an area that will see growth in the year ahead. What’s expected to be a 10 per cent increase in sales volume will put upward pressure on pricing and Ash said he expects to see the average price of a home rise to $438,000 next year from an estimated high of $417,000 by the end of this year. At the end of 2008, the average house price was $430,000.
“The important thing is that Canadians are confident in the economy and the banking system, and that’s driving quicker recovery,” he said. “The economic fundamentals in place going forward ideally position the ten provinces, and the sector overall, for further growth.”
A number of factors will help prop up activity going forward, including improved economic conditions, continued low interest rates, rising consumer confidence and solid capital spending which will buoy employment. Inventory will once again assume the wildcard role, with any decline placing upward pressure on prices. Multiple offers will remain the exception in most markets, more commonplace on quality entry-level product which remains in tight supply.
The report found that sales are forecast to recover in almost all major centres by year-end 2009, led by an anticipated 45 per cent increase in Greater Vancouver. Two markets —Ottawa and Quebec City —are expected to hit historic highs in the number of homes sold. Average price should post new records in 65 per cent of markets surveyed this year. As economic performance ramps up across the country, so too will residential real estate.  Eighty-three per cent of markets (19/23) are expecting sales to increase over 2009 levels while housing values are forecast to escalate in 91 per cent (21/23) of Canadian centres in 2010.  The remaining markets will match 2009 levels.