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Mississauga, ON (December 3, 2008) ?? Global economic uncertainty weighed heavily on residential real estate activity in most major Canadian centres during the latter half of 2008. Although the forecast for 2009 promises more of the same, most markets are expected to
weather the storm, says RE/MAX.
The RE/MAX Housing Market Outlook for 2009 examined residential real estate trends in 22
markets across the country and found that average price held up remarkably well in 2008,
despite 13 centres reporting double?digit declines in home sales. Solid gains earlier in the year
likely served to prop?up housing values at year?end. The prognosis for housing activity in the
first six to nine months of 2009 is somewhat static, given continued volatility in financial markets and the threat of recession, but as stability returns to the financial sector, housing markets are expected to recover.
Nationally, 440,000 homes are expected to change hands in 2008, down 15 per cent from record
2007 levels. Canadian housing values are expected to hover at $300,000, a nominal three per
cent decline from last year’s historic peak. By year?end 2009, unit sales should match 2008
levels, while average price is forecast to fall another two per cent to $293,000.
“Housing market performance will clearly be contingent on economic performance at a local,
provincial, and national level in 2009,” says Michael Polzler, Executive Vice President and
Regional Director, RE/MAX Ontario?Atlantic Canada. “Issues affecting the overall economy are
impacting housing markets across the country and the situation is not expected to be remedied
until consumer confidence is restored. That said, we could see a bounce back as early as spring
– if inventory levels remain stable, pent?up demand kicks into gear, and lower interest rates
stimulate home?buying activity.”
Major markets are evenly split in terms of housing performance in 2009, with 11 centres
forecast to match or exceed 2008 home sales and 11 expected to slide from 2008 levels. The
highest percentage increase in unit sales is anticipated in Saskatoon, where the number of
homes sold is forecast to climb three per cent in 2009. Housing values are expected to hold the
line in 2009, with St. John’s, Montreal, Kingston, London, Winnipeg, Saskatoon, and Regina
posting modest gains in average price in 2009.
“Canada’s real estate environment is considerably more complex than it has been in recent
years,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The
landscape is definitely changing ?? with most markets shifting into either balanced or buyer’s
territory. The shut out is over. Sellers no longer rule the roost. Opportunities exist for
purchasers like never before, including lower interest rates, greater inventory levels, the luxury
of time to make decisions, and the upper?hand at the negotiating table. Motivated vendors will
need to take note of the new mindset and set their prices accordingly.”
Canadian sellers are slowly adjusting to new realities. For most markets, 2008 started in
balanced territory and moved into buyer’s market conditions during the latter half of 2008. The
year ahead will prove challenging, especially for vendors.
“While the economy will dictate real estate performance next year, it’s important to remember
that demand still exists in the marketplace,” says Sylvain Dansereau, Executive Vice President,
RE/MAX Quebec. “In the midst of stock market turmoil, sold signs continue to appear on lawns
across the country. With affordable lending rates and increased selection, first?time and moveup
buyers with good credit may choose to play their investment strategy safe and purchase a
home. The comfort of a tangible investment like real estate goes a long way in tough times.”
RE/MAX is Canada’s leading real estate organization with over 18,000 sales associates situated
throughout its more than 670 independently owned and operated offices across the country.
The RE/MAX franchise network, now in its 35th year, is a global real estate system operating in
close to 70 countries. More than 7,000 independently owned offices engage more than 100,000
member sales associates who lead the industry in professional designations, experience and
production while providing real estate services in residential, commercial, referral and asset
management. For more information, visit: www.remax.ca.
