Alberta resale market readies for rebound

When the real estate dust settles this year, Alberta will likely be the only province with a decline in average resale selling prices--until 2010, says a national group.

The Canadian Real Estate Association is forecasting average prices will slip to $342,300, a decline of three per cent from last year.

But the price will likely climb to $360,500 next year--a 5.3-per-cent increase that is expected to be the third highest percentage gain in Canada behind Manitoba and Newfoundland, says the association, which is the umbrella group for all real estate boards in Canada,

In actual dollars, Alberta will likely have the second highest average price in the country, behind B.C.'s $478,900.

CREA says much of the expected annual price increase in Alberta next year reflects weakness in the average price from January to March 2009--something that isn't expected to be repeated in 2010.

In its latest forecast for the Prairie provinces, Canada Mortgage and Housing Corp. expects the average selling price in Alberta will finish this year at $339,000, climbing to $354,000 in 2010.

Nationally, CREA says the average price is forecast to climb by 4.2 per cent to a record $317,900 this year. That price strength will likely hold in 2010, when a 4.7-per-cent hike will push the average to $333,000.

Sales across the country continue to run strong, forcing the CREA to make upward revisions to some of its forecasts for the remainder of this year and for 2010.

In terms of sales, the level of buyer interest during September and October was enough to have CREA erase its call for an estimated 432,000 deals across Canada this year, moving the forecast up to slightly more than 460,000. Next year, the newly projected number calls for 492,300 homes to change hands, making 2010 the second strongest year on record.

Sales in Alberta this year and next will continue to rebound from a 21-per-cent drop between 2007 and 2008. By the end of this year, provincial sales will hit just over 58,000, a gain of almost three per cent.

The big move will have to wait until next year, when CREA is calling for a rise of 11.6 per cent to 64,800 sales. The percentage increase will be the second largest in Canada behind B.C.'s 12.6 per cent.

In its latest forecast, CMHC is calling for MLS sales to hit 56,825 this year, climbing to 61,950 next year.

"Pent-up demand built in late 2008 and early 2009 as many buyers moved to the sidelines pending an improved economic outlook," says CREA president Dale Ripplinger. "With the economic outlook having improved since then, the release of that pent-up demand will boost activity over the rest of the year and in 2010."

(prepared by Marty Hope/Calgary Herald)