Canada's Housing Bubble

Dec 24, 2011 news1130.com

Bank forecasts a sales drop of 15% and a home-price decrease of 12% in 2012

VANCOUVER (NEWS1130) - According to economists at the TD bank, "a larger-than-average price and sales correction looks to be in store" for the housing market in Vancouver. It forecasts a sales drop of 15% and a home-price decrease of 12% over the 2012-2013 period."

The outlook says "since the summer some of the steam in prices and sales has escaped" the Vancouver market, leaving this area "in a better position than...six months ago."

The TD points out that in November the seasonally adjusted average home price was $756,000, the lowest to date in 2011. It also says sales growth has "come down from double-digit highs to a fairly flat, even slightly negative, year-over-year reading."

The outlook says also says "A slower Chinese economic growth profile suggests that investors could pull back their real estate acquisitions." But it adds that any decrease in condo demand should be cushioned by "the large share of new immigrants who choose to settle in Vancouver."