MNI DATA ANALYSIS: Canada Nov Resales -2.3%;Forecasts Rev Down

By Yali N'Diaye      

     OTTAWA (MNI) - Existing home sales fell 2.3% to 37,790 in November, marking

the third consecutive monthly decrease and indicating that the May-August

rebound was short-lived, data from the Canadian Real Estate Association showed

Monday.

     Sales decreases were widespread across provinces, including a 3.1% drop in

Ontario, although British Columbia recorded a 3.4% increase. In Canada's two

most expensive markets that remain on the Bank of Canada's radar screen,

residential sales were also down: by 9.8% in Greater Vancouver and by 3.9% in

Greater Toronto.

     On the supply side, the number of new listings fell 3.3% on the month, with

declines in 70% of markets, lifting the sales-to-new listings ratio to 54.8%

from 54.2%. Still, CREA estimates that conditions remain balanced in 60% of

local markets.

     Prices also decreased on the month, with the Home Price Index Benchmark

Price down 0.5%, including a 1.9% decrease in Greater Vancouver and a 0.4%

decline in Greater Toronto. On a year-over-year basis, the HPI was up 2.0%.

     The national average price was down 0.8% to C$493,029 on the month.

     On an unadjusted 12-month basis, sales fell 12.6% in November, with the

average price down 2.9%.

     The ongoing contraction of activity indicates that the dampening effect of

tighter monetary and macro prudential policies proves to be lasting despite the

labor market strength.

     In fact, CREA revised down its forecasts for this year and next.

     It now expects a double-digit drop in home resales in 2018 (-11.2%) from

2017, while it expected a 9.8% decrease last September. Sales are now expected

to contract 0.5% to 456,00 in 2019, 16,700 less than the September projection.

     The average price is now seen contracting 4.2% this year, instead of 2.8%.

It is forecast to rebound 1.7% to C$496,800 in 2019, instead of the 2.7% gain to

C$508,400 projected last September.

--MNI Ottawa Bureau; +1 613 869-0916; email: yali.ndiaye@marketnews.com

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