The Canadian Real Estate Association (CREA) has issued a cloudy outlook for the country’s housing market in 2019.
According to CREA, national home sales are projected to fall to a near-decade low in 2019, as rising interest rates and strict mortgage stress-test rules put a damper on homebuyer sentiment. The industry association, which represents more than 125,000 realtors, is projecting that home sales across the country will decline to their lowest point in nine years but stay little changed from 2018, falling only by 0.5% nationwide to 456,200 units.
CREA is projecting that the average price for a home sold in Canada through its multiple-listing service will rise 1.7% to $496,800 in 2019. The association forecasts a rebound in sales activity in Ontario and gains in Quebec. Sales are forecast to fall steeply next year in Alberta and British Columbia.
CREA has also revised down its projections for this year (2018), saying that it expects national home sales will decline by 11.2% to 458,200 units in 2018 — the lowest level in five years. The group says B.C. and Ontario will make up the majority of this year's decline, while sales in Alberta, Saskatchewan, Manitoba and Newfoundland will also fall to multi-year lows.
National average home prices were slated to end this year (2018) down 4.2% to $488,600 from 2017. CREA blames 2018's price drop on a 2.6% year-over-year decline in Ontario as fewer higher-price homes were put up for sale in Toronto. Oil price declines have wreaked havoc on housing prices in western Canada, while the largest sales decline this year was in British Columbia, which has been attributed to an increase in the foreign-buyers' tax.
