Canadian Real Estate’s Boom is Over, Cooling Underway

The Canadian Real Estate Association said Thursday that prices of resale homes edged up in Canada last month, but at a more moderate pace, signaling further cooling in the once red-hot sector. That leaves the average sale price up 4.0 per cent from March of last year. The average price of a resale home in Canada’s major markets was $329,383 in March, up from $327,477 in February and $325,183 in January. Average prices realized through MLS sales were up 5.5 per cent from the first quarter of 2007, for the first three months of the year, that’s the smallest year-over-year price increase in seven years.

The Canadian Real Estate Association said Thursday that prices of resale homes edged up in Canada last month, but at a more moderate pace, signaling further cooling in the once red-hot sector. That leaves the average sale price up 4.0 per cent from March of last year. The average price of a resale home in Canada’s major markets was $329,383 in March, up from $327,477 in February and $325,183 in January. Average prices realized through MLS sales were up 5.5 per cent from the first quarter of 2007, for the first three months of the year, that’s the smallest year-over-year price increase in seven years.

While new listings grew in the first quarter, CREA figures show that overall sales fell last month by 18.7 per cent from a year earlier. CREA chief economist Gregory Klump said in a release that “Many major markets are becoming more balanced and price gains are becoming more modest as a result.” He adds that “This trend is forecast to continue as rising mortgage carrying costs and property taxes erode affordability.”

Doug Porter of BMO Capital Markets declared that. “Canada’s six-year housing market boom is officially over,” and CREA president Cal Lindberg said the days of constantly setting price records are over. Economists agreed. Saskatoon, Winnipeg, Hamilton-Burlington, Ottawa and Halifax in March, set price records that the latest figures show that five major markets managed to set still, the most expensive real estate could be found in Greater Vancouver, where the average resale last month cost $616,496, up 11.1 per cent in a year as usual.

Where average house prices have fallen 10 per cent in the past year amid a meltdown in the U.S. subprime mortgage market, the cooling trend in Canada still stands out from the situation south of the border. The next most expensive markets were: Victoria ($504,194, up 13.3 per cent), Calgary ($419,396, up 1.0 per cent), Toronto ($380,338, up 4.1 per cent) and Edmonton (343,760, up 5.6 per cent).

Jron Magcale
http://realestatepr.org

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