The national home sales forecast has been revised upwards, to an 8.1% increase in units for 2007. The sets new annual records for most provinces. Right now, the 2008 forecast predicts slightly lower sales activity, as well as smaller price increases as compared to 2007.
The Canadian Real Estate Association (CREA) expects the resale housing market to become more balanced as housing prices increase and higher interest rates further impact affordability for Canadian buyers.
Yes, prices will continue to increase with the average price forecast to set new records over the nest two years across all of Canada. However, increases are also forecast to become smaller as the resale housing market balances out in 2008.
All Canadian regions are reflecting a truly upbeat home buying sentiment, and financing is still within reach for most potential home buyers. What will cause a balance for 2008 are rising prices and higher mortgage interest rates- these directly impact affordability. On the positive side, strong employment numbers will keep sales activity fairly strong, despite price and interest rate increases.
Ann Bosley, the President of CREA, notes that consumers continue to have strong confidence in Canada’s resale housing market, and activity is on track to set a new annual record in 2007. She also says that the Canadian market has shrugged off the subprime problems that have affected the housing market in the United States.
The CREA MLS residential average price forecast for Ontario:
| Average price | 2006 : | $278,455 |
| Annual % change | 2006 : | 5.9% |
| Average price forecast | 2007: | $302,300 |
| Annual % change forecast | 2007: | 8.6% |
| Average price forecast | 2008: | $316,700 |
| Annual % change forecast | 2008: | 4.8% |
Tammy Dufault
Century 21 BJ Roth Realty Ltd.
