Canadian property prices and sales to rise

Recent forecasts from the Canadian Real Estate Association (CREA) have predicted that property prices will rise in the country in 2011 and the number of sales will increase.

As the economic recovery continues and consumer confidence improves, the CREA expects the nation’s property market to improve this year.

Values expected to rise later in 2011

Gregory Klump, chief economist at CREA said: “Even though mortgage interest rates are expected to rise later this year, they will still be within short reach of current levels and remain supportive for housing market activity.  Strengthening economic fundamentals will keep the housing market in balance, which will keep home prices stable.”

The CREA predicts that the average property price in Canada will rise by 1.3 per cent in 2011 and 2012 (to $343,300 (around £220,000) and $347,900 (around £222,400) respectively.)  The average price is expected to rise by a small amount in most parts of the country reflecting a healthy balance between the demand for and supply of homes for sale.

Canadian property sales in late 2010 more buoyant than expected

CREA have revised their forecasts upwards, mainly thanks to the fact that property sales in the second half of 2010 were higher than previously anticipated.  Mr Klump added: “The hand off going into 2011, together with the highs and lows for sales activity posted in 2010, provided guidance for CREA’s revised forecast.”

Property sales in Canada are now expected to reach 439,900 units in 2011 with a further three per cent increase (to 453,300 units) in 2012.