What slowdown? Real estate has record year in Canada

The resale housing market in Canada's major cities enjoyed a record year for sales and prices in 2007, the Canadian Real Estate Association said Tuesday.

The industry group said a record 362,934 homes were sold through the MLS system last year. For the year as a whole, the average price realized was $326,055 — up 10.8 per cent from 2006 levels.

"Resale housing demand remained high throughout 2007 due to job and income growth, the continuation of attractive financing, and upbeat consumer confidence," said CREA chief economist Gregory Klump.

He forecast that sales in 2008 would slip from last year's record levels, but would still remain strong. Average prices are expected to rise, but "at a slower pace," he said.

In December, the average resale home in 24 major markets sold for $332,836. That's a rise of 13.1 per cent from the previous December — the largest year-over-year gain in more than three years.

No fewer than 13 of the 24 markets reported double-digit price increases, led by the two biggest cities in Saskatchewan. Both Regina and Saskatoon reported that home prices were more than 45 per cent higher than they were a year earlier.

Those gains showed again that Alberta has been overtaken as the price boom leader. Average price increases in Calgary and Edmonton barely made it into the double-digit arena in December, with year-over-year gains of 10.7 per cent and 12.1 per cent, respectively.

The most expensive real estate continues to be located in Vancouver. The average resale home in that city was $566,192 in December, a gain of 9.0 per cent from the previous December.

Home prices in many centres in central Canada held up well, with prices in Toronto, Sudbury, Thunder Bay and Quebec City all recording double-digit year-over-year growth.


The manufacturing slump clearly weighed only in Windsor-Essex and St. Catharines, Ont. Average prices rose by just 1.3 per cent in St. Catharines, while prices in Windsor fell 3.4 per cent from the previous December — the only major market in Canada to report price declines.

The healthy Canadian housing market stands in sharp contrast to the "deepening trauma south of the border," noted BMO Capital Markets economist Doug Porter.

"Housing is very unlikely to provide as much support to Canadian growth in 2008, but it's also unlikely to follow the U.S. market's due-south lead either," he said.

CBC News January 15, 2008