Home sales expected to drop slightlly in 2008

Flagging consumer confidence is expected to eat into housing sales in greater Toronto this year, according to poll results released yesterday by Royal Bank of Canada.

Just 26 per cent of GTA residents say they are now "somewhat likely" or "very likely" to buy a home, down from 36 per cent a year ago, according to a survey carried out by Ipsos Reid in January.

"We expect to see some softening in home buying this year in the GTA, which is consistent with what we're seeing in Ontario as a whole," said Kathy Ellis, a sales manager at RBC responsible for arranging financing packages for residential developments.

This could be the result of a run-up in prices along with concerns about the economy, Ms. Ellis added.

Despite the general downturn in interest, the GTA was the region in which the greatest number of owners and renters said they were very likely to buy a home in the next two years - at 10 per cent.

That compares with a 7-per-cent average for the rest of the country, the lowest level since RBC started its poll 15 years ago.

Other findings suggest that, at 91 per cent, GTA residents are more likely to see a home or condo purchase as a good investment than the national average of 85 per cent.

(prepared by Lori Mcleod/Globe and Mail)