Canadian home sales remain strong

Home sales in Canada's major markets during the third quarter of 2007 edged back 4.1% from the previous quarter's record levels but remained strong, according to an industry report released Tuesday.

Seasonally adjusted figures show that 89,482 units were sold in the third quarter of 2007, the third highest quarterly figure on record, according to the Canadian Real Estate Association (CREA).

The report indicated that the quarterly decline was mainly due to fewer unit sales in Edmonton, Calgary and Montreal. Reductions in these major markets more than off set the increase in sales activity in Vancouver.

"Resale housing activity remains strong, but it is beginning to ease back from its breakneck pace recorded in the first half of the year," said CREA chief economist Gregory Klump. "Sales activity remains on track to set a new annual record this year."

The report said that on a year-to-date basis, sales activity is well ahead of levels recorded last year. There were 291,003 units of sales in Canada's major markets in the first nine months of 2007, an increase of 8.7 per cent from the same period in 2006. The CREA statistics indicated that year-to-date transactions remained above year-ago levels in almost all of the major markets surveyed.

The report authors argued that a substantial increase in new listings caused markets in Calgary, Edmonton, Saskatoon and Regina to become more balanced. By contrast, markets in Vancouver, Victoria, Winnipeg, Toronto, Kitchener-Waterloo, Ont., Ottawa and Saint John, N.B. have become tighter since the year began according to the report.

"The recent surge in new listings has quickly put major markets in Alberta into balanced territory," Klump added. "Buyers in those markets will likely take shop, and remove some of the steam from price increases."

Seasonally adjusted figures from CREA show there were 148,022 new listed units in the third quarter, the second highest level on record. The marginal decline in new listings was less than the quarterly sales decline that, according to CREA,led to a more balanced resale market in the third quarter.

"Over the long haul, a strong and stable market is good for both buyers and sellers" said CREA president Ann Bosley. "We have not seen any of the large adjustments that have affected markets in the United States.

"The underlying economic conditions in Canada that affect real estate are still very strong. The main reason for any market adjustment stems from volume of new listings."

In the major markets, the residential average price increased 11.9% year-over-year to $329,113 in the third quarter. Vancouver, Calgary, Regina, Saskatoon, Quebec City and St. John's, N.L., as well as the Ontario cities of Sudbury, Windsor, St. Catharines and Kitchener-Waterloo, all posted the highest quarterly average prices on record.

September residential average price (year-to-year percentage change):

TOTAL $324,312 (10.6)

-- Calgary 415,391 (21.4)
-- Edmonton 339,382 (39.9)
-- Halifax-Dartmouth $216,716 (6.3)
-- Hamilton-Burlington & District $268,340 (8)
-- Kitchener-Waterloo $251,157 (5.7)
-- London & St. Thomas $202,613 (6.5)
-- Montreal $227,276 (6)
-- Ottawa $272,773 (5.9)
-- Outaouais (Hull) $177,173 (9)
-- Quebec City $163,777 (10.3)
-- Regina $160,296 (20.6)
-- Saint John $140,289 (10.8)
-- Saskatoon $228,096 (43.9)
-- Newfoundland & Labrador $148,035 (5.5)
-- Toronto $372,480 (5.6)
-- Greater Vancouver $568,498 (12.6)
-- Winnipeg $173,354 (12.4)

(Source: Canadian Real Estate Association)