Monday, December 7, 2009

Canadians Posive About House Prices

Canadians are emerging from the recession confident that the value of their homes is rising and optimistic about their local housing markets. The Canadian mortgage market is rebounding and will surpass the $1 trillion mark in 2010, reports the Canadian Association of Accredited Mortgage Professionals (CAAMP) in the fifth edition of the Annual State of the Residential Mortgage Market.
Canadians are positive about house prices, and attitudes about whether this is a good time to buy a home have never been higher in the three years that CAAMP has surveyed on that question. The overwhelming majority of those surveyed (40%) expect house prices to go up, which is more than double the opinion of those surveyed in spring 2009 (18%).
In past surveys, negative house price sentiments were most evident in British Columbia, Alberta and Ontario, provinces that in retrospect were hardest hit by the economic downturn. On a 10-point scale (where 1 is very negative and 10 is very positive), attitudes in these provinces have sharply rebounded to 6.44 from 4.77 in fall 2008, 6.24 from 5.00, and 6.30 from 5.11, respectively, and are now in line with the 6.25 national average.
As interest rates remain low, it is not surprising that Canadians continue to be satisfied with their mortgages. Of those who renewed in the last year, 73% received lower rates than their original mortgage term.

Five tips for a quick home sale.

Positive signs are appearing that support a recovery in the Canadian real estate market. Residential sales activity via the Multiple Listing Service (MLS) of Canadian real estate boards numbered 42,288 units for October 2009, according to the Canadian Real Estate Association. This is up 41.5% compared to October 2008, when news of the global financial crisis hammered consumer confidence. New records for the month of October were reported in about one-fifth of local markets, including Toronto, Montreal and Ottawa.
Whether this road to recovery has been sparked by historically low interest rates never before seen by even your parents or grandparents, or optimism about Canada’s economic recovery, more people are thinking about moving.
So how do you ensure your house is not the one sitting on the market months after you have decided to sell? Following are five tips to help ensure you make a quick sale.
1. Work with a pro. To ensure a quick sale, you have to be sure your buyers can afford to pay what they offer. As an experienced real estate agent, I take precautions to make sure buyers are not overreaching their grasp. And based on my negotiating expertise, I can work with buyers and negotiate contracts that do not, as a rule, tend to fall through.
I also bear all the costs of advertising your home. This can seem minor at first, but newspaper ads and signage can quickly add up.
And, best of all, I work for you. It’s in my best interest to ensure your home sells fast and you’re pleased with the price you receive for your home.
2. Price accordingly. As your local real estate agent, I’m in the know when it comes to what’s selling in your marketplace. I have access to a database of statistics that enable me to help you set a price that will make your house attractive to buyers without undercutting your bottom line. After all, if your home stays on the market for an extended period of time, the process can become extremely hard on you and your family – especially if you have your eye on another home.
3. Set the stage. Aside from pricing your home accurately from the onset, the way your home is seen by potential buyers is the next most important aspect in ensuring a quick sale. Getting your house ready to sell can help you connect with buyers on an emotional level that enables them to picture themselves and their families living in your home.
With the popularity of home decorating and renovation programs on TV, people are more accustomed to looking at houses with an eye for design. But this doesn’t have to cost you a fortune. The most important first step is getting rid of clutter and personal items so potential buyers can picture themselves easily moving in their belongings. I can also suggest ways for you to rearrange your furniture to make your living space more appealing to potential buyers.
4. Go where the buyers are. If you want a quick sale at the best price, it only makes sense to compete on the biggest market – and there’s no question that the biggest market in Canada is the Multiple Listing Service, or MLS, which can only be accessed by real estate agents. A full 90% of all home sales go through the MLS.
Going it alone means relying on yourself and, while that may sound appealing to some, the numbers argue against it.
5. Create word of mouth. Finally, if you have a home that one of your friends or acquaintances has often admired, put the word out to your friends and ask them to spread the word. Doing so could help you avoid the stress of staging and hosting open houses, and get you the quick sale you’re seeking.
As always, if you have any questions or concerns about selling your home quickly and for the right price, I’m here to help!

October Home Sales Highest in Six Years

Vancouver, BC – November 17, 2009. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province climbed 115 per cent to 8,624 units in October compared to the same month last year. Last month posted the highest number of MLS® residential sales for the month of October since 2003, when 8,682 units changed hands. The average MLS® residential sales price in the province climbed 17 per cent to $493,328 from $420,259 in October 2008.
“BC homes sales continued on an upward trend in October,” said Cameron Muir, BCREA Chief Economist. “Despite a lackluster economy, low mortgage interest rates have induced many potential buyers into the market. However, the recent phenomenal pace of home sales is expected to moderate in the coming months as pent-up demand dissipates and eroding affordability begins to impact the purchasing power of households.”
Year-to-date, MLS® residential sales dollar volume increased 14 per cent to $33.3 billion over the same period last year. A total of 72,146 units were sold in the first ten months of 2009, up 13 per cent from 2008, while the average MLS® price was up 1 per cent to $461,694.
“Copyright British Columbia Real Estate Association. Reprinted with permission.”

Market Strength Extends Through 2010

BCREA Fall 2009 Housing Forecast

Vancouver, BC – November 13, 2009. The British Columbia Real Estate Association (BCREA) released its Fall 2009 Housing Forecast today.

BC Multiple Listing Service® (MLS®) residential sales are estimated to increase 20 per cent to 82,900 units this year from 68,923 units in 2008. Residential sales in 2010 are forecast to increase a further 8 per cent to 89,600 units. The ten-year average is 82,800 units.

“A sharp rebound in consumer demand turned a potentially dismal year into a very strong year for home sales,” said Cameron Muir, BCREA Chief Economist. “Vancouver and Victoria, in particular, are posting near record unit sales this fall.”

BC interior housing markets are also experiencing robust consumer demand as low mortgage rates and stronger market confidence drive home sales higher.

The average annual MLS® residential price in the province is expected to post a new record this year, rising 2 per cent to $463,200 and is forecast to climb an additional 4 per cent to $482,800 in 2010.

“Recovery in the BC economy will unfold gradually next year,” added Muir. “With sales prices in some markets flirting with record highs, affordability constraints will limit home price inflation over the next year.”

“Copyright British Columbia Real Estate Association. Reprinted with permission.”

Home Shopping in the Off-Season

If you’ve been thinking about buying a new home but don’t think that the cooler months make for an ideal time, you may actually benefit from changing your perspective. Though spring and summer are typically the most active real estate buying and selling seasons, house hunting in winter has its own benefits. Knowing what they are and how to use them to your advantage can put you on the path to home ownership sooner rather than later.
One of the best reasons to buy a house in winter is that there is less competition out there. Because many people believe that buying a home in cooler months is a bad idea, they stay home waiting for spring to come instead of house hunting. After all, moving at this time can be inconvenient and messy if you have to deal with inclement weather. Additionally, families will be less likely to move in the months of September through June if their children are in school.
It’s the perfect time to start looking for a home during months when there are fewer house hunters. With less buyers in the market, homes move more slowly and sellers are more willing to negotiate on their asking price. They often need to move from the property in the near future, and you can use that to your advantage to get a favorable deal on a house that may otherwise be out of your price range during the peak selling seasons.
Lenders also usually have fewer loans to process and less paperwork to deal with in the off-season. With lenders less hassled, you can expect a smoother mortgage approval process.
Touring a home during the winter allows you to see things that you may not have been exposed to if you had come in the summer months. For instance, drafts may be a sign that windows need replacing or that there are air leaks that may need to be sealed. If the house feels warm without the thermostat being set too high, it may be an indication that the home has good insulation.
If you decide to brave the cold and hunt for a home during winter, there are a few things you should keep in mind. First, don’t feel like you’re going to inconvenience someone by viewing their home during the holidays, evenings or weekends. Sellers want to sell just as much as buyers want to buy. Also, don’t be overcome by holiday decorations, which can make a house look cramped or have the opposite effect of making the house more emotionally appealing than it otherwise would be.
Just like any holiday shopping sale, knowledgeable shoppers know where to find great opportunities. The same holds true for real estate. There are still homes for sale in winter and bargains to be found, so don’t let the seasons rule your search for a home.

Choosing you Mortgage Amortization

Selecting the length of your mortgage amortization period – the number of years it will take you to become mortgage free – is an important decision that will affect how much interest you pay over the life of your mortgage.
While the lending industry’s benchmark amortization period is 25 years, and this is the standard that is used by lenders when discussing mortgage offers, and usually the basis for mortgage calculators and payment tables, shorter or longer timeframes are available – to a maximum of 35 years.
The main reason to opt for a shorter amortization period is that you will become mortgage-free sooner. And since you’re agreeing to pay off your mortgage in a shorter period of time, the interest you pay over the life of the mortgage is, therefore, greatly reduced.
A shorter amortization also affords you the luxury of building up equity in your home sooner. Equity is the difference between any outstanding mortgage on your home and its market value.
While it pays to opt for a shorter amortization period, other considerations must be made before selecting your amortization. Because you’re reducing the actual number of mortgage payments you make to pay off your mortgage, your regular payments will be higher. So if your income is irregular because you’re paid commission or if you’re buying a home for the first time and will be carrying a large mortgage, a shorter amortization period that increases your regular payment amount and ties up your cash flow may not be the best option for you.
The key is to select the amortization that best suits your unique requirements and ensures you have adequate cash flow. If you can comfortably afford the higher payments, are looking to save money on your mortgage or maybe you just don’t like the idea of carrying debt over a long period of time, opting for a shorter amortization period may be ideal for you.
Advantages of longer amortization
Choosing a longer amortization period also has its advantages. For instance, it can get you into your dream home sooner than if you choose a shorter period. When you apply for a mortgage,
lenders calculate the maximum regular payment you can afford. They then use this figure to determine the maximum mortgage amount they are willing to lend to you.
While a shorter amortization period results in higher regular payments, a longer amortization period reduces the amount of your regular principal and interest payment by spreading your payments out over a longer timeframe. As a result, you could qualify for a higher mortgage amount than you originally anticipated. Or you could qualify for your mortgage sooner than you had planned. Either way, you end up in your dream home sooner than you thought possible.
Again, this option is not for everyone. While a longer amortization period will appeal to many people because the regular mortgage payments can be comparable or even lower than paying rent, it does mean that you will pay more interest over the life of your mortgage.
Still, regardless of which amortization period you select when you originally apply for your mortgage, you do not have to stick with that period throughout the life of your mortgage. You can always choose to shorten your amortization and save on interest costs by making extra payments when you can or an annual lump-sum principal pre-payment. If making pre-payments (in the form of extra, larger or lump-sum payments) is an option you’d like to have, you should ensure the mortgage you end up with will not penalize you for making these types of payments.
It also makes good financial sense for you to re-evaluate your amortization strategy every time your mortgage comes up for renewal (at the end of each term of your mortgage, whether this is three, five, 10 years, etcetera). That way, as you advance in your career and earn a larger salary and/or commission or bonus, you can choose an accelerated payment option (making larger or more frequent payments) or simply increase the frequency of your regular payments (ie, paying your mortgage every week or two weeks as opposed to once per month). Both of these features will take years off your amortization period and save you a considerable amount of money on interest throughout the life of your mortgage.

3rd quarter housing activity

National resale housing activity climbed to the highest level of any third quarter on record.
Actual (not seasonally adjusted) home sales via the Multiple Listing Service (MLS) Systems of Canadian real estate boards totaled 135,182 units in the third quarter of 2009, according to statistics released by the Canadian Real Estate Association (CREA). This is the highest level of activity on record for the period from July to September. The number of transactions was up 18% from the third quarter of last year, representing the biggest year-over-year increase since early 2002.
Seasonally adjusted national MLS home sales numbered 127,941 units in the third quarter, up 12% from the previous quarter. Building on two previous quarterly increases, seasonally adjusted MLS home sales activity now stands 48% above the low reached in the fourth quarter last year.
Low interest rates, rebounding consumer confidence and an improving overall sense of economic security continue to draw homebuyers to the housing market.

Housing Activity to Strengthen in 2010

Housing starts have started to recover and are expected to continue to improve in the second half of 2009. Starts are expected to reach 141,900 for the year and will increase to 164,900 for 2010, according to Canada Mortgage and Housing Corporation’s (CMHC) fourth quarter Housing Market Outlook, Canada Edition* report.
“We expect housing markets across Canada to strengthen leading into and over the course of 2010 as economic conditions improve”, said Bob Dugan, Chief Economist for CMHC.
“Demand for existing homes has rebounded since the beginning of the year. In addition, lower inventory levels characterize both the new and existing home markets. As a result, stronger housing demand will be reflected in higher levels of housing starts in 2010”, said Mr. Dugan.
The strong pace of MLS® 1 sales seen in the second and third quarters of this year reflects, in part, activity that was delayed in the previous two quarters and is not likely to be sustained. The level of sales is expected to move back closer in line with anticipated economic conditions. As a result, existing home sales, as measured by the Multiple Listing Service (MLS®), will reach 441,300 units in 2009 and increase to 445,150 units in 2010. The average MLS® price is expected to be $312,950 in 2009 and $324,500 in 2010.
As Canada's national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.
CMHC November 2, 2009

Canada's remarkable housing recovery

The signs of economic recovery seem to be everywhere these days. Consumer confidence is up. The governor of the Bank of Canada has all but declared the recession over, with the latest GDP figures suggest that the economy is growing again. The stock market has surged 50 per cent from its March low. Plenty of "green shoots" and all that.
A stunning recovery in the Canadian housing market also appears to be taking hold if anecdotal evidence and the statistics are to be believed. Sales are up by double digits in most major markets across the country (they've more than doubled in Vancouver). Average selling prices have rebounded from just the start of the year and are now at record levels in most provinces. Bidding wars have returned in Vancouver and Toronto.
That's a remarkable turnaround from the situation just eight months ago, when prices were down year-over-year in the more expensive markets and sales slumped more than a third from the previous year's levels. Many homeowners took their properties off the market to wait out the slump, which led to a dearth of listings and helped to stop the slide in prices.
Most economists see this quick bounce-back as surprising but healthy — further proof that Canada and the Canadian consumer weathered the global recession better than our American cousins. But a few observers remain wary of jumping on the housing bandwagon. They point to other statistics — like the country's rising deficit, rising unemployment, rising personal bankruptcy numbers, rising household debt levels, a hobbled manufacturing sector and mortgage rates that have nowhere to go but up.
They see all this as raw material for a looming drop in housing prices that could leave many recent homebuyers who've put five per cent down "under water" — in other words, owing more on their homes than the homes are worth. In some U.S. markets, more than half the homeowners who have mortgages have negative equity.
Former maverick MP, federal cabinet minister and personal finance author Garth Turner is one observer who's firmly in the "bubble" camp. His real estate blog — entitled "Greater Fool" — has been forecasting something approaching a housing meltdown for a while now.
Last winter, Turner predicted the real estate market would wither in the face of the recession. But it didn't — a fact he attributes to low interest rates that encouraged "massive borrowing by people I thought were already hideously indebted." He also blames the real estate industry for "irresponsibly telling people prices would rise forever and [that] they must buy now while rates were low."
To be sure, most analysts don't see the housing market as being in bubble territory. They argue that homes are much more affordable now than they were during the last major bubble in the late 1980s, when mortgage rates were above 10 per cent. But there's no denying that there's something of a frenzy in some markets these days.
Low rates + confidence = sales
There's widespread agreement that low mortgage rates are spurring the recent buying spree in housing. At the time of writing, a five-year fixed mortgage was available at most major financial institutions at a generational low of 4.19 per cent — even less at a few smaller lenders. That has prompted buyers who had headed to the sidelines late last year to flood back into the market.
Some times, that flood of buyers is directed at some of the same properties. "The max we've seen so far this year is 20 offers one evening on a semi-detached home," Toronto realtor Thomas Cook wrote in his blog in July.
Some observers also credit a couple of measures introduced in February's federal budget aimed at first-time buyers — a $750 tax credit and an extra $5,000 that buyers can take from their RRSPs for a down payment.
But low interest rates are still the biggest factor. Still, Gregory Klump, chief economist at the Canadian Real Estate Association, says mortgage rates alone weren't enough to push people from browsing to buying. People are now more confident their jobs are safe, he told CBC News. "Improved affordability combined with improved economic security — that's resulting in the drastic rebound in sales activity," he says.
The Bank of Canada has pledged to keep its key overnight lending rate at a rock-bottom 0.25 per cent until at least the middle of 2010, as long as inflation doesn't pick up. In the short term, there seems little likelihood of that.
Rate hikes to come eventually
But some economists are warning that the central bank may eventually be hiking rates big time. "The tightening will not likely begin before the third quarter of 2010," according to S├ębastien Lavoie, an economist at Laurentian Bank Securities.
"That said, when the time does finally come, timid [quarter percentage point] increases will not be enough to 'normalize' rates," he wrote in early September. "The Bank [of Canada's] exceptionally low current policy rate implies that the tightening cycle will have to be quite aggressive." How aggressive? Lavoie forecasts "a succession of hike announcements" of a half, three-quarters and perhaps even a full percentage point at a time.
Increases that large could, of course, play havoc with the real estate market. Those who stretched to buy through a 35-year amortization could find themselves in big trouble when it comes time to renew if rates spike. Given that a recent survey from the Canadian Payroll Association found that 59 per cent of Canadians are living paycheque to paycheque, the prospect of a sharp jump in mortgage costs would hit some owners very hard.
"People need to be circumspect," CREA's Klump agrees. "They need to run through the scenarios. What if rates jump two per cent?"
Do the math
A quick look at the math shows what could happen if rates do jump substantially. Let's assume someone has bought a house for $320,000 — the average national MLS selling price in August. If they put five cent down, they'd face a mortgage of $304,000 plus mortgage loan insurance of $8,360 for a total financing requirement of $312,360.
With a five-year mortgage rate of 4.19 per cent amortized over 35 years, that yields monthly payments of $1,412 month. Jack the rate up to 8.0 per cent, and the monthly payment jumps more than $700 to $2,189.
Rising prices and rising mortgage rates will make it more difficult to carry that home purchase. "If prices continue to eclipse incomes [as they have for seven years], affordability could become an issue again for first-time buyers, especially when interest rates return to more normal levels beyond 2010," warns BMO economist Sal Guatieri.
A variable rate mortgage is now available for as little as prime plus 10 basis points (2.35 per cent) — a big improvement from the prime plus one per cent that was offered earlier this year. At MonsterMortgage.ca, vice-president Vince Gaetano tells CBC News the majority of clients at his firm are going variable, with about 35 per cent choosing a five-year fixed mortgage.
He notes that most bankers last year were predicting rates would jump — warnings that led many who had been enjoying variable rates as low as 1.45 per cent to lock in for five years at rates above five per cent. Needless to say, he doesn't think much of bank prognostications.
Will recovery stall?
While bidding wars have returned in a few markets, a better balance between supply and demand could be in store as more listings appear. Nationally, average selling prices in August were up 11.3 per cent from the previous year to $324,000. But realtors say that average is skewed upwards by more sales of expensive homes in the more expensive markets (for instance, Calgary saw one home sell for $10.3 million in August).
CREA says factoring out changes in sales activity results in a year-over-year weighted price increase of 7.1 per cent. The weighted August figure was actually down 0.8 per cent from July.
In the short term, most observers think the recovery in Canadian housing sales will continue as mortgage rates stay historically low and more listings appear. Longer term, there's more uncertainty. The real estate industry sees national sales rising 5.3 per cent in 2010 and average home prices rising modestly — up 2.1 per cent over 2009. CMHC predicts an average price increase of 1.6 per cent.
Others are more cautious. A recent survey by Royal LePage of more than 1,100 of its agents found only 61 per cent thought the housing market's current strength was sustainable. The biggest reason cited by the doubters was the expectation that mortgage rates will rise.
Real estate watchers are advising borrowers to be careful in the current low mortgage rate environment and add some wiggle room to their affordability calculations. Rates are bound to go up at some point — the only question is when and how fast.
September 21, 2009 Tom McFeat, CBC News

BC Housing Market Gains Momentum

Vancouver, BC – October 15, 2009. The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province climbed 68 per cent to 8,576 units in September compared to the same month last year. The average MLS® residential sales price in the province climbed 15 per cent to $474,169 from $412,149 in September 2008
“Upward momentum in consumer demand continued unabated in September,” said Cameron Muir, BCREA Chief Economist. “Low mortgage interest rates and renewed confidence in real estate assets has propelled BC home sales to a level not seen in two years.” September posted the highest number of BC MLS® residential sales for that month since September 2005, and the third highest ever recorded for the month of September.
“While Victoria and the Lower mainland are exhibiting strong sellers’ market conditions with rising prices, housing markets in the rest of the province are experiencing a more gradual recovery,” added Muir.
Year-to-date, MLS® residential sales dollar volume increased 6 per cent to $29 billion over the same period last year. A total of 63,521 units were sold in the first nine months of 2009, up 6 per cent from 2008, while the average MLS® price declined 1 per cent to $457,389.

MLS® home sales remain strong in August

National resale housing market sales activity remained up from year-ago levels in August 2009 for the third consecutive month, posting the largest year-over-year gain in more than two years.
According to statistics released by The Canadian Real Estate Association (CREA), a total of 42,483 homes traded hands via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards in August 2009. This represents an increase of 18.5 per cent from the same month last year, and the third consecutive year-over-year gain of more than 15 per cent. Sales were 6.6 per cent below the record for the month of August set in 2007.
On a seasonally adjusted basis, national MLS® home sales held steady. At 42,426 units, seasonally adjusted activity came to within six-tenths of one per cent of levels in the previous month. Seasonally adjusted activity in Alberta and Quebec declined, offsetting activity gains in British Columbia. Seasonally adjusted activity still remains 60.8 per cent above the decade-low in January.
“National sales activity in the third quarter is on track for a significant increase compared to the second quarter,” said CREA President Dale Ripplinger. “Low interest rates and affordability continue to attract homebuyers to the housing market. Consumer confidence continues to rise, which bodes well for activity in the coming months.”
Resale activity in August 2009 was up from year-ago levels in about approximately three-quarters of all local markets. Year-over-year gains in Vancouver (117 per cent), Toronto (27 per cent), Calgary (17 per cent) and Montreal (nine per cent) contributed most to the national increase in activity. Aggregate MLS® home sales activity for 25 major markets posted the third consecutive increase from year-ago levels of more than 20 per cent in August.
Demand continues to improve in Canada’s more expensive housing markets, drawing the national average price upward. The national MLS® residential average price rose 11.3 per cent from year-ago levels to $324,779. This is the highest national average price for the month of August.
The MLS® residential average price for the month of August set records in every province except Alberta. A sustained increase in sales activity, including a rebound in activity at the higher end of the price spectrum in some of Canada’s priciest markets, is skewing the national average price upward.
This price trend is similar but more muted for the weighted national MLS® average price, which compensates for changes in provincial sales activity by taking into account provincial proportions of privately owned housing stock. The weighted national MLS® average sale price in August 2009 was up 7.1 per cent year-over-year, but down eight-tenths of a per cent from the previous month.
The weighted average price increase for an aggregate of 25 major markets reveals a similarly muted trend compared to its unweighted counterpart. The major market weighted average price rose 5.3 per cent year-over-year in August 2009, compared to an increase of 11.8 per cent for the unweighted major market average price. The major market weighted average price compensates for changes in sales activity in major markets by taking into account the proportion of privately owned housing stock in each market in relation to the major market aggregate.
The number of new listings coming onto the MLS® market posted the eighth consecutive decline from year-ago levels. New residential listings were down 8.9 per cent year-over-year to 64,167 units, the lowest level for the month of August in five years.
Improved demand is combining with fewer new listings to draw down inventories on the housing market. There were 212,227 homes listed for sale on the MLS® Systems of real estate Boards in Canada at the end of August 2009, down 13.3 per cent from a year earlier. This is the fourth consecutive year-over-year decline in active listings.
Nationally, the number of months of inventory was up slightly to five months in August from 4.4 months in July, but still well below the recessionary peak of 12.8 months in January 2009. The number of months of inventory edged up in most major markets in August. The number of months of inventory is equal to the supply of active listings at the end of the month divided by the number of sales that month. It represents the number of months it would take to sell current inventories at the current rate of sales activity.
The seasonally adjusted dollar volume of all residential MLS® sales set a new record in August 2009, rising 1.5 per cent from the previous month to $14 billion. British Columbia contributed most to the increase, having posted the highest seasonally adjusted dollar volume on record for the province.
“The balance of sentiment making big-ticket purchases pushed into positive territory in August for the first time since early last year,” said Chief Economist Gregory Klump. “Recent cuts to mortgage interest rates will no doubt provide further support for this indicator, which is an important factor underlying the housing market.”
“Activity may be leveling out as we indicated in last month’s revised resale housing market forecast. Average prices dropped sharply over the second half of 2008 and have rebounded since then, so comparisons against year-ago levels are likely to show continued improvement over the rest of 2009.”
CREA September 15, 2009
“Copyright Canadian Real Estate Association. Reprinted with permission.”

August Home Sales Continue at Brisk Pace

The British Columbia Real Estate Association (BCREA) reports that Multiple Listing Service® (MLS®) residential sales in the province climbed 66 per cent to 8,565 units in August compared to the same month last year. The average MLS® residential sales price in the province climbed 12 per cent to $471,078 from $421,685 in August 2008.
“Homes sales continued at a rapid pace in August,” said Cameron Muir, BCREA Chief Economist. “Attractive home prices and low mortgage rates were key drivers in the market.”
The number of active residential listings declined 20 per cent over the past year, with August posting 26 per cent fewer active listings than the peak in December 2008 (seasonally adjusted). “Home prices edged higher in many markets over the summer months as declining inventories created competition among homebuyers for the best properties.”

Year-to-date, MLS® residential sales dollar volume declined 2 per cent to $25 billion over the same period last year. A total of 54,945 units were sold in the first eight months of 2009, up 1 per cent from 2008, while the average MLS® price declined 2 per cent to $454,769.

BCREA Vancouver, BC – September 11, 2009.

“Copyright British Columbia Real Estate Association. Reprinted with permission.”

Housing Starts Increase in August

The seasonally adjusted annual rate of housing starts increased to 150,400 units in August from 134,200 units in July, according to Canada Mortgage and Housing Corporation (CMHC).
“Housing starts are trending higher, reflecting improvements in both the single and multiple segments,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “The improvement in housing starts is consistent with our expectation of a stronger second half for 2009.”
The seasonally adjusted annual rate of urban starts increased by 14.0 per cent to 131,800 units in August. Urban multiple starts increased by 23.8 per cent to 77,600 units, while urban single starts moved up 2.5 per cent to 54,200 units in August.
August’s seasonally adjusted annual rate of urban starts increased by 56.0 per cent in British Columbia, by 16.1 per cent in the Prairies, by 13.8 per cent in Ontario, by 9.6 per cent in Atlantic Canada, and by 2.5 per cent in Quebec.
Rural starts were estimated at a seasonally adjusted annual rate of 18,600 units in August2.
As Canada's national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.
CMHC September 9, 2009

Housing Activity to Rebound in Second Half of 2009 and in 2010

Housing starts are expected to rebound in the second half of 2009 and will reach 141,900 for the year. Starts will increase to 150,300 for 2010, according to Canada Mortgage and Housing Corporation’s (CMHC) third quarter Housing Market Outlook, Canada Edition* report. The overall forecast totals for housing starts remain unchanged from the second quarter release.
"Economic uncertainty and lower levels of employment tempered new housing construction in the first half of this year", said Bob Dugan, Chief Economist for CMHC. "In the second half of 2009 and in 2010, we expect housing markets across Canada to strengthen."
Improving activity on the resale market and lower inventory levels in both the new and existing home markets are expected to prompt builders to increase residential construction.
Existing home sales, as measured by the Multiple Listing Service (MLS®)1, have rebounded strongly since January and will reach 420,700 units in 2009 and remain close to that level at 419,400 units in 2010. The average MLS® price is expected to moderate to $301,400 in 2009 and to increase to $306,300 in 2010.
As Canada's national housing agency, CMHC draws on more than 60 years of experience to help Canadians access a variety of quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making vital decisions.
CMHC September 3, 2009