Real Estate Association Lowers 2015 Forecast to Reflect Lower Oil Prices
OTTAWA - The Canadian Real Estate Association is predicting that the impact of declining oil prices on consumer confidence in some provinces will push down Canadian home sales by 1.1 per cent this year, to 475,700 units countrywide.
CREA also estimates the national average home price will grow by two per cent to $416,200 this year, a smaller increase than last year, as Alberta's average home prices slip by an estimated 3.4 per cent this year to $387,600.
The association had previously predicted home sales would be 0.8 per cent above 2014, rising to 485,200 units, but revised its outlook downwards to reflect further deterioration in the price of oil.
Provinces with significant oil production will see declines in home sales. Alberta is expected to see sales activity decline by 19.3 per cent in 2015, Saskatchewan by 11.2 per cent, Manitoba by 2.2 per cent and Newfoundland by one per cent.
Canada's other provinces will continue to see higher sales and relatively stable or higher average sales prices, according to CREA.
British Columbia is projected to see the number of home sales increase by 4.9 per cent, Nova Scotia by 3.7 per cent and Quebec and New Brunswick by 2.5 per cent.
Ontario is expected to see a 1.9 per cent boost in sales levels from 2014, while Prince Edward Island is projected to see sales activity rise by 1.4 per cent.
The B.C. average home price is expected to rise 3.4 per cent this year over 2014 to $587,600 and Ontario's average price will grow 2.5 per cent to $441,900. Apart from those two provinces and Alberta, prices elsewhere are expected to be within one per cent of last year.
The Canadian Real Estate Association says home sales in February were up one per cent from January as the market was divided by sharp regional differences.
The overall increase was led by the Vancouver and Okanagan regions in B.C. and Toronto. However, the association says sales were lower in more than half of all local markets compared with January as buyers on the Prairies stayed on the sidelines amid low oil prices.
Compared with a year ago, sales last month were up 2.7 per cent from February 2014. The number of newly listed homes fell 2.5 per cent in February compared to January. The national average price for a home sold in February was $431,812, up 6.3 per cent on a year-over-year basis.