Report just out today....in Globe & Mail.

http://www.reportonbusiness.com/servlet/story/RTGAM.20070820.whousingupgrade0820/BNStory/robNews/home


ROMA LUCIW

Globe and Mail Update

August 20, 2007 at 4:26 PM EDT

Even as the U.S. housing market continues to unravel, record home buying activity in Canada has prompted even higher sale targets and further projected price increases.

Sales of existing homes are expected to reach 523,100 units this year, an 8.1-per-cent increase over last year, the Canadian Real Estate Association said in a new residential forecast issued Monday. That is up from a previous target of 500,995 units and 3.6 per cent growth.

The CREA had already revised its sales growth target once this year, in May. Its original forecast, in February, predicted that sales would ease 1.6 per cent from 2006, pressured by higher prices and rising mortgage costs.

But instead of easing, second-quarter sales activity hit a record, prompting the sunnier outlook for the remainder of the year. “We had anticipated that the market would cool in the second quarter, but instead of cooling, it went further to a boil,” Gregory Klump, chief economist with the Ottawa-based group, said in an interview.


Despite trouble south of the border, the Canadian Real Estate Association is boosting its outlook for year-over-year sales growth in 2007 to 8.1 per cent from 6.5 per cent.

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The strength in the housing market is no longer a Western Canadian story, Mr. Klump said, noting that second-quarter sales activity was brisk in Ontario and the Eastern provinces. “The thing that came in as a surprise is that sales were higher than what we had been anticipating in every province.”

Unit sales in 2007 are forecast to be strongest in Saskatchewan, surging 33.7 per cent from last year, and weakest in British Columbia, rising 4.6 per cent.

Not only are sales expected to set records in most provinces this year, prices are forecast to reach new highs in every province both this year and in 2008, although the pace of price increases will ease next year, the CREA said.

Nationally, the average price is seen rising 10.4 per cent to $305,900 this year and adding another 5.5 per cent to $322,700 in 2008. Price gains will be largest in Alberta, surging 24.6 per cent to $355,600 in 2007, and 6.6 per cent to $379,000 next year.

However, the resale market is still expected to ease in 2008, with national unit sales forecast to dip 2 per cent.

“The resale housing market will become more balanced as rising prices and higher mortgage interest rates gradually impact affordability,” Mr. Klump said. “Strong employment numbers will keep sales activity strong, even as prices and interest rates continue to rise.”

A vastly different scenario is unfolding in the United States, where the collapse of the subprime mortgage market has triggered a severe downturn in the housing market, leading to widespread fears about the overall health of the U.S. economy and triggering a global credit crunch which has rattled financial markets.

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Rajeev Narula, Broker, REALTOR®
ACE TEAM REALTY INC., Brokerage
10 Kingsbridge Garden Circle, Suite 704
(Opp Square One - HWY10/403)
Mississauga, ON L5R 3K6
Bus: 1-888-355-3155 Ext. 300
Fax: 1-888-443-3155
Email:
Web: http://www.RAJEEV.ca" rel="nofollow">LINK

Rajeev,

As requested to Rahul, please try to group recent real estate news / updates into one thread. This will give it some continuity as opposed to the same discussion starting all over again in various threads.

http://www.canadiandesi.com/read.php?TID=18241&page=2

http://www.canadiandesi.com/read.php?TID=18337&page=1#105488

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Are you there?

Hi BL,

Will abide by your wishes.

-----------------------------------------------------------------
Rajeev Narula, Broker, REALTOR®
ACE TEAM REALTY INC., Brokerage
10 Kingsbridge Garden Circle, Suite 704
(Opp Square One - HWY10/403)
Mississauga, ON L5R 3K6
Bus: 1-888-355-3155 Ext. 300
Fax: 1-888-443-3155
Email:
Web: http://www.RAJEEV.ca" rel="nofollow">LINK

http://www.edmontonsun.com/News/Edmonton/2007/08/28/4451570-sun.html
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Home sellers are slashing their asking prices by tens of thousands of dollars as Edmonton's once sizzling housing market continues to cool, says a city real estate agent.

And new figures from the Edmonton Real Estate Board show the vast majority of sellers are now getting less than they're asking for - a stark contrast to the bidding wars of a year ago that routinely forced buyers to pay more than the list price.

"There's tons of stuff on the market. There's twice as much inventory in residential real estate today as there was a year ago at this time," Re/Max agent Abe Hering told Sun Media yesterday.

"If your supply mushrooms tremendously, inevitably the only product that will get consumed is the one that's best priced."

As a result, Hering said he routinely advises clients who've had their homes on the market for awhile to drop their asking price by 10% in order to remain competitive. On an average $417,000 single-detached home, that works out to more than $40,000.



"There's no sense reducing any product by 5% because it just doesn't work. We're seeing reductions of 10% and more," he said.

Jon Hall, with the Edmonton Real Estate Board, said 85% of single family homes that sold over the past 30 days went for less than the asking price. On average, the final figure was nearly $12,000 less than the seller was seeking.

Condos didn't fair much better, with 79% going for less than the asking price.

"What most realtors seem to be saying is that the sellers haven't adjusted their mindset to the new reality - that we have over 8,000 listings and that buyers have choice," Hall said.

He said many sellers are knowingly asking for more than their home can fetch.

"And quite frankly, the realtors are getting a bit frustrated," Hall said.

"The client sets the price. If the seller says, 'I want it listed $20,000 above the market price,' they've got to do it. Ten days or two weeks later, the realtor's coming back and saying, 'I told you so,' and dropping the price."

There are several theories as to why there are so many homes on the market.

Carolyn Pratt, president of the Realtors Association of Edmonton, said some investors are trying to dump property.

Other people are moving into larger or smaller homes, while trying to capitalize on the market. Some sellers like to list during the summer months, she said.

Pratt said she's also heard some homeowners cashing out and moving back to their home provinces, like Saskatchewan, where homes are cheaper.

Keith Mackie, fleet director for Budget Rent-a-Car, sees it every day. He said demand for moving trucks going to Saskatchewan from Alberta and B.C. has recently increased three-fold.

"It seems like a lot of people are going home," said Mackie. "There's no doubt about it, it's a significant number."

Hall said many sellers with homes on the market in Edmonton today won't sell.

"It would be fair to say a lot of listings will melt. They'll just disappear," Hall said. "They'll just be withdrawn after a typical 60- or 90-day listing period."

The Edmonton Real Estate Board recently reported there was virtually no increase in the selling price of single family residence in July. That month, condo prices went up 2.5%, while townhomes increased 1%. The figures for August are expected to be released early next month.

Yes Good time to buy now.

Good time to watch the show and wait for next 6 months. It will go down more. A lot of new homes will be coming in market all over Calgary and Edmonton in next 6-10 months.

Two major mortgage bankers suspend sub-prime lending: brokers
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http://www.cbc.ca/cp/business/070824/b082486A.html


TORONTO (CP) - Mortgage brokers say they have been notified by two major Canadian mortgage bankers that they have temporarily suspended sub-prime - or higher risk - lending in Canada.

MCAP Financial, which provides mortgage financing through brokers, has sent out a memo saying it has temporarily stopped financing sub-prime loans through its Eclipse division.

Several Toronto-area brokers said in interviews Friday that MCAP, as well as GMAC Residential Funding of Canada Ltd., have stopped financing mortgages to higher risk applicants with weak or murky credit histories.

A third, smaller company,N.B.rook, has made a similar announcement.

As the ripple effect of the credit crunch sweeps through the financial markets, it seems like there's still plenty of money available to lend to Canadians with good credit records.

However, consumer with less than perfect credit records are going to find it harder to get a loan as conditions tighten, lenders say.

Continue Article

Mortgage broker Vince Gaetano, vice-president of MonsterMortgage.ca, said Friday he was very surprised to get the memo from one of his major lenders,

"We were quite surprised by the MCAP announcement," said Gaetano.

MCAP's financing represents about half to two-thirds of MonsterMortgage's sub-prime business - loans to people with poor credit histories. The sub-prime segment is only about 15 per cent of MonsterMortgage's business.

The tightening up can be traced back to the woes of short-term loan seller Coventree has impacted other companies.

Other companies which have pulled back areN.B.rook and GMAC Residential Funding, according to the mortgage brokers.

MCAP and GMAC could not be immediately reached for comment.