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Thursday, August 17, 2006

Homewoners Sell Record Number of Houses

CREA's monthly report shows a slowdown in July, lead by Calgary and Vancouver. Edmonton's market increased significantly, but not enough to raise the national average. An important thing to note, these stats only include resale housing, and Calgary and Vancouver both had record sales of new homes which could account for the difference.

This month in Edmonton we (at Coldwell Banker Johnston) are seeing fewer listings get multiple offers, it doesn't seem to be the feeding frenzy now that it was in August. There appear to be more listings for sale - I don't have any hard stats to prove this, it's just something we are feeling. My bet is when the stats come out for August there will still be lots of records set in Edmonton, but price increases will be less, the number of listings will be greater, and the number of days on market will be longer (July set an all time record for days on market in Edmonton).

Here is the article from CBC News:

Sales of resale homes are heading for another record this year, despite a slowdown in July and the expected softening of the market over the next few months.

Average home prices have climbed by 10.1 per cent in a year. (CBC) Average home prices have climbed by 10.1 per cent in a year. (CBC)

In its regular monthly report, the Canadian Real Estate Association said resale housing activity edged down by 2.9 per cent in Canada’s major cities last month, to 27,231 units.

But the industry's performance in July did little more than tarnish what has been a record-setting pace for the first seven months of the year. Sales are still 2.6 percentage points over the comparable period in 2005, and heading for another record, while seven major cities have broken volume records for the first seven months — Calgary, Edmonton, Saskatoon, Winnipeg, Ottawa, Montreal and Saint John.

Homeowners also did well at the bank. The average price of a house rose to $294,924 in July 2006, up 10.1 per cent over the year, with record levels in Edmonton, London, St. Catharines, Ont., and Montreal.

Resale homebuyers are on track to break new volume records this year, but CREA chief economist Gregory Klump warned that a slowdown is imminent. He expects the sales pace to decline slightly in coming months, leading to a higher inventory of unsold houses and a levelling of prices.

The CREA numbers refer to existing houses, condominiums and townhouses sold through the Multiple Listing Service, adjusted for the season. The data does not include newly built homes.

Most of July's decline was in Vancouver and Calgary, two cities that have seen record sales of new homes in recent months and record levels of construction.

"Demand for resale homes remained strong across Canada’s major markets in July 2006," Klump said, pointing to stable interest rates, strong employment levels and rising incomes.

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