There are early signs of a “gradual correction” in the housing market following a period where consumer finances became “stretched,” Bank of Canada senior deputy Governor Tiff Macklem said in a speech last Thursday.

Canadian existing home sales fell in December, led by a drop in Vancouver, capping an annual decline in transactions, a national realtor group said.

Vancouver sales declined 5.3 per cent to 1,792 units in December from November, while across Canada, resales declined 0.5 per cent during the month to 35,386 units, the Canadian Real Estate Association said in a statement on Tuesday.

While the number of transactions dropped 17.4 per cent across Canada from a year earlier, the average home price rose 1.6 per cent to $352,787.

“Successive rounds of tightening mortgage regulations have kept the housing market in check during what has become an extended low interest rate environment,” Gregory Klump, the CREA’s chief economist, wrote in a separate report.

The average resale price in 2012 rose 0.3 per cent $363,740, and the total number of houses sold through the realtor group fell 1.1 per cent to 453,372, according to the group.

Tuesday’s report excluded figures for Quebec, which will be delayed until Jan. 22 at the request of the provincial real estate body, the group said in the report.

The CREA notes the correction in Canada’s housing market gathered momentum in December as the number of new listings slipped, prices moderated and the number of homes sold fell 17.4 per cent from a year earlier, the biggest drop-off in six months.

On a year-over-year basis, the CREA said Tuesday that 20,538 homes were sold across the country through its MLS system last month, down from 24,850 in December 2011, and 0.5 per cent lower than in November.

The increase in prices also continued to slow, tipping in at only 1.6 per cent from a year ago to $352,800 – about the level of overall inflation.

“The housing market is clearly in correction mode,” said Derek Holt, vice-president of economics at Scotia Capital.

“But this is certainly nothing even close to the U.S. and European experience and I don’t think we’re headed in that direction, but it’s still sizable.”

Analysts note sales are down by double digit margins since Finance Minister Jim Flaherty tightened mortgage rules in July to cool the market, adding that it a needed correction to avoid a bigger problem in future.

Klump said he believes the new rules, on top of three previous rounds of tightening, have had an impact.

Since July, the market has experienced contractions in sales, construction, building permits and property listings.

The only anomaly is prices, which have continued to rise, although at a more measured pace.

Source: The Province

Like many others, Toronto public relations manager Megan Vickell is sitting on the real estate sidelines dreaming of bargains to come.

The 28-year-old has never owned a property and is hoping to scoop up a discounted Toronto condo when prices fall off today’s frothy record highs.

You can’t blame her for wanting to wait. Research firm Urbanation Inc. says Toronto’s average condo prices climbed to as high as $407 per square foot in 2012, a sharp rise from the $229 per square foot fetched in the first quarter of 2003.

The picture is not much different nationally. The average sale price across the country was $364,260 over the first 11 months of 2012, according to the Canadian Real Estate Association. Compare that to beginning of this boom when the average sale price across the country was $158,303 in 1999.

But what if the crash never comes?

Urbanation says preliminary condo results for the fourth quarter show prices are down 0.8% in Toronto year over year and Canada-wide home prices were also down 0.8% in November from a year ago. But, so far, that’s about it.

The one thing missing from the market, for all those people looking for a crash, is a catalyst or an event that will force people to reduce their asking prices. Before this housing market burns up in flames, it needs some type of spark.

And, if you talk to some people, that key event — two that come to mind are a spike in interest rates or job losses — is not happening any time soon.

“Crashes don’t just happen in a vacuum, you need a trigger,” says Benjamin Tal, deputy chief economist with CIBC World Markets. “I can’t point to any crisis in the history of crashes that didn’t have a trigger.”

In the United States, the trigger proved to be a sub-prime market and the expiry of teaser rates that jumped as much as four percentage points on some mortgages. Overnight, people couldn’t afford their homes.

“If you have a gradual increase in the rates this doesn’t happen,” says the economist, who predicts a decline in prices but only in the 5% to 10% range. The real estate industry is on the same page, continually calling for a soft landing.

What has people like Ms. Vickell excited and looking for a major decline in prices is the massive drop off in sales activity in some major markets. Nationally, sales were down almost 12% in November from a year ago. Vancouver remains the leading example where sales were down 22.7% in 2012 from a year earlier.

So you’re sitting on the sidelines, not buying at what many consider ridiculously high prices — the product of a 14-year boom that has only seen one mild pullback during the recession in 2008. But what if sellers simply refuse to lower their price, something that has happened so far in the markets where sales are drying up very fast. What’s next?

“I think stagnation is a good word for what will happen, it’s what we saw in the market from 1992 to 1997,” says Mr. Tal.

The CREA stats show the market nationally — albeit real estate can be a very regional story — did not move all that much in the 1990s before it took off in 1999. There were some corrections in the 5% range on a yearly basis but average prices from a bottoming out of $142,091 in 1990 had climbed to $154,768 by 1997 — an 8% increase that is paltry by today’s standards for such a long period.

“We are going to see a correction and the question is ‘what will emerge from that,’” said Mr. Tal. “The scenario is the market will not be strong, it will be stagnant.”

In this scenario, instead of people of people selling in a panic, they pull their homes off the market, waiting for a better day, refusing to sell at distressed prices. New listings and active listings will start to shrink.

“In the U.S., you had to sell your house because you were delinquent. If you tell me tomorrow the unemployment rate [in Canada] will jump to 12%, we will have a crisis,” said Mr. Tal.

Don Lawby, chief executive of the Century 21 Canada, and a charter member of the club that doesn’t see home prices dropping anytime soon, can’t see any desperation from sellers.

“The economy continues to be okay, people have jobs, interest rates are low,” said Mr. Lawby. “Historically, anytime when prices dropped it was tied to high unemployment and interest rates. It’s not the case today, people are not forced to sell, they are staying with their price.”

Still, Ms. Vickell’s patience may pay off. Even Mr. Lawby concedes that the condo sector may be hit. Developers who already have buildings under construction may be forced to scale down projects or lower prices on unsold units.

“They are going to be throwing in packages to sell,” says Mr. Lawby. “But the average homeowner, without an economic event, they have no need to sell.”

David Madani, Canada economist with Capital Economics, takes a more extreme view, predicting a price-drop of 25% in the next year or two across the country. Rapidly flagging sales are a sure sign his prediction will come to fruition, he says.

“We have to tell our clients ‘you don’t necessarily need a trigger.’ You reach a threshold point where people get afraid, where valuations have lost touch with fundamentals,” he says, adding there is a standoff between buyers and sellers before any crash. “Sellers eventually realize the market has shifted beneath them and they capitulate and drop their asking price.”

But Mr. Madani’s calls for a crash are being largely drowned out by the real estate industry’s steady calls for a soft landing.

Gregory Klump, chief economist with CREA, says history supports the notion that some sort of major event is needed to create a housing market collapse.

“In the late 1980s, it was a case of a spike in interest rates, in late 2008 and early 2009 it was a massive layoff,” said Mr. Klump. “You need a massive and extended economic shock and none of that is in the forecast.”

In the interim, people waiting for a decline a major decline in price will have to keep waiting, says Mr. Klump. Only time will tell if it ever materializes.

Source: Garry Marr, Financial Post

The slowdown in Vancouver’s real estate market is one factor leading the Canadian Real Estate Association to cut its sales forecast for this year and next on Monday.

Vancouver’s sales numbers dropped 27.6 per cent — the second biggest drop in the country behind Halifax — in November 2012, compared to the same month last year, after tighter lending rules that came into force this summer. The average price is down 6.3 per cent for the same period to $682,215, while the MLS home price index is down 1.7 per cent from a year ago. The average price reflects the mix of sales, while the HPI reflects price changes for typical homes.

While BMO deputy chief economist Doug Porter said most cities across Canada would see a soft landing for their real estate markets, he called Vancouver a “rather obvious exception.”

“I don’t know that I’d call it a hard landing in Vancouver, but it’s definitely a bumpier landing than most cities in Canada are going through right now,” Porter said.

Meanwhile, it appears people thinking of selling their homes may be holding off, especially in Metro Vancouver, as the region saw the largest drop in the country for new listings.

New supply reached its lowest level in more than two years, CREA said.

“That may help avert a harder landing for prices because sellers do have the leeway to back off,” Porter said. “Fundamentally, I think that’s one of the reasons why the Canadian housing market is likely not going to have a hard landing because you’re not going to have a lot of motivated sellers — people aren’t going to be forced into it by rising interest rates or declining employment so they can take their time and wait for the market to stabilize.”

Source: Tracy Sherlock and Craig Wong, Vancouver Sun

Lower home sales in November have prompted the Canadian Real Estate Association to cut the sales forecast it released in September for this year and next.

The association said today that sales over the Multiple Listing Service fell 1.7 per cent from October to November, with activity last month coming in 11.9-per-cent lower than last November.When it released its forecast in September the market was just showing the first signs of a slowdown, but it now expects the decrease in demand to persist, it added.

“Lower than projected third quarter sales have downgraded the prospects for activity this year in almost every province,” the association, which represents realtors across the country, said as it updates its projections. It also suggested that the continued slowing is the direct result of Ottawa’s decision to tighten mortgage rules this summer.

“Interest rates have remained low and the economic backdrop has remained supportive for housing activity, so that should leave little doubt that recent changes to mortgage regulations are responsible for having cooled activity,” said CREA’s chief economist Gregory Klump.

The slowdown is beginning to show up in prices, which have lost their momentum. The national average price of houses that sold in November came in 0.8 per cent lower than a year ago. The MLS Home Price Index, which seeks to account for changes in the type of houses sold, rose by 3.5 per cent, its smallest increase since May 2011.

CREA now expects resales of existing homes across the country to come in at 456,300 units this year, down 0.5 per cent from last year and nearly one per cent below the ten-year average.

In September the association said it expected resales to rise by 1.9 per cent this year to 466,900 units, a figure that it had already revised down.

There are regional variations to the trend. Alberta is expected to see a 13.1-per-cent rise in sales this year, while British Columbia will see a 10.7 per cent decline.

CREA now expects next year’s sales over the MLS system to come in at 447,400 units, down 2 per cent from this year. In September it estimated that that number would be 457,800 units – again, a figure that it had already revised downwards.

“The continuation of moderate economic, job, and income growth will temper the impact of recent mortgage rule changes, which are not expected to dampen activity much more than has already been felt until interest rates are expected to begin rising in late 2013,” the association stated in its new forecast.

It now expects the national average home price will rise by 0.3 per cent for all of 2012 to $363,900. Most provinces should see higher increases than that, but a decline in sales of more expensive homes in British Columbia and Ontario is weighing on the average, it said.

CREA also said Monday that the number of newly listed homes in Canada fell 0.9 per cent in November from October, with Greater Vancouver posting the largest decline.

“With sales and new listings moving in the same direction and by similar magnitudes, the national sales-to-new listings ratio was little changed at 50.3 per cent in November compared to 50.7 per cent in October,” it added. “Based on a sales-to-new listings ratio of between 40 to 60 per cent, three out of every five local markets were in balanced market territory in November.”

Sales have now contracted in eight of the last 11 months, and the decrease compared to last November is “hefty,” Toronto-Dominion Bank senior economist Sonya Gulati said in a note.

The slowdown in both prices and sales is most noticeable in Toronto, Montreal and Vancouver, she added, saying those cities “are more vulnerable to experience a greater-than-average housing adjustment.”

Nationwide, TD expects market conditions to stabilize early next year “as tighter mortgage rules loosen their grip on market trends and low interest rates lure homeowners back into the market,” the note said.

Source: Tara Perkins, The Globe and Mail

Canada’s cooling housing market has made a soft landing with steady sales and pricing through the fall, reveals a real estate trends report from Scotiabank which anticipates a gradual decrease rather than a U.S.-style housing market crash.

“Canada’s national housing market is shifting toward a more sustainable path, though significant differences in regional conditions continue,” Adrienne Warren, Scotiabank’s senior economist, said in the report.

Housing demand is expected to be soft which could lower sales and home prices, especially in buyers’ markets such as Vancouver or where there is over supply such as the condominium market in Toronto, it added.

“However, with the Canadian economy continuing to post healthy job growth, and sellers proving responsive to the underlying shift in market conditions, a sharp decline in prices nationally is unlikely.”

Nationally, sales in October were down about 10% from strong spring levels, but only slightly below the average pace of the past decade. Home sales in Alberta and Saskatchewan have increased this year, supported by stronger economic and labour market performance; in contrast in B.C., which faces the greatest housing affordability challenges, sales have dropped about 10% this year, the report said.

Another report released Monday by the Canada Mortgage and Housing Corp. said Canadian housing starts fell last month for both single-and multi-family homes, particularly in Ontario and British Columbia. The seasonally adjusted annualized rate of housing starts was 196,125 units in November, down from 203,487 in October and well below the high above 250,000 hit early in the year.

Canada’s housing market has been slowing since the spring after years of red-hot growth that sparked debate about a bubble. The market boomed as historically-low interest rates fuelled purchases, driving up prices and adding to household debt. The high and rising home prices combined with the tightening of mortgage insurance rules in recent years have made houses less affordable, notably for first-time buyers.

Source: Melissa Leong, Financial Post

The Bank of Canada is keeping its trendsetting interest rate anchored at one per cent for the remainder of the year and sending a message that it still believes the cost of borrowing in Canada will go up at some point in the future.

The decision by the central bank’s policy setting panel was in line with the expectations of markets and economists, who had given only low odds to governor Mark Carney removing a mild bias towards raising rates sometime.

Canada’s dollar gained strength after the announcement. It was up 0.19 of a cent to 100.7 cents US — slightly higher than just prior to the central bank’s announcement.

The bank’s statement Tuesday suggests it is looking through the disappointing third quarter result as a temporary aberration.

Last week, Statistics Canada reported the country’s gross domestic product output had slowed to 0.6 per cent — about half what the bank had predicted in October, and the weakest result in more than a year.

The bank’s statement Tuesday said that “economic activity in the third quarter was weak, owing in part to transitory disruptions in the energy sector” — referring to some maintenance shutdowns.

“Although underlying momentum appears slightly softer than previously anticipated, the pace of economic growth is expected to pick up through 2013. The expansion is expected to be driven mainly by growth in consumption and business investment, reflecting very stimulative domestic financial conditions.”

Tying improved conditions to 2013 suggests governor Carney, who has announced his intention to step down in June to take charge of the Bank of England, now realizes the economy is unlikely to live up to his 2.5 per cent hopes in the current fourth quarter as well.

In a bit of a surprise, Carney says he is not as yet convinced the recent cooling in housing activity in Canada, and slowdown in credit accumulation, represents a fundamental shift.

On Monday, Finance Minister Jim Flaherty said he was pleased housing was moderating and that Canadians were starting to pay off debt, a shift in the credit and mortgage market he attributed in part to his decision to tighten borrowing rules in July.

Carney says, however: “It is too early … to determine whether the moderation in housing activity and credit will be sustained.”

That is likely because the bank expects to keep interest rates, and as a result borrowing costs, at historic lows for likely another year.

Part of what has Carney in a holding pattern, both in terms of rates and his language, is that he does not know the outcome of the so-called fiscal cliff negotiations in Washington. Canadian policy-makers say if no deal is reached in the next month to extend tax cuts and program spending, the U.S. economy could take a battering amounting to about four percentage GDP points next year, sufficient to send it and likely Canada back into recession.

As it is, Carney said the uncertainty over whether Washington will be able to avoid figuratively going over the cliff is already impacting the economy.

Otherwise, not much has changed in the past month or so, the bank says. Europe is still in recession, the U.S. is recovering but at a gradual pace and Chinese growth appears to be stabilizing. If there is good news for Canada in all this, it’s that commodity prices have remained elevated, which helps the country’s terms of trade.

For many economists, those conditions might warrant the central bank jettisoning its pretence that it will raise rates “over time,” and acknowledge a rate cut may equally be in the offing in the next year or so.

But Bank of Montreal economist Doug Porter said in a note Tuesday morning that Carney will want to await the results of the fiscal cliff talks in Washington, and is holding his fire — if he has any to shoot — until the announcement date on Jan. 23 when he knows better the situation.

Tuesday’s decision was the 18th consecutive time Carney has kept the policy rate at one per cent, comprising over two years, the longest stretch of stability since the 1950s.

Source: Julian Beltrame, The Canadian Press

RE/MAX, in the company’s latest outlook on the real estate market, states that “Moderation – not correction – is on tap for Canadian housing markets in 2013”.

According to a report released today by RE/MAX, Canadian real estate markets demonstrated remarkable resilience in 2012, with home sales up or on par in 65 per cent of major centres — despite considerable headwinds in terms of tighter financing and economic uncertainty abroad. The trend is expected to continue, with home-buying activity propped-up by low interest rates and an improved economic picture in 2013.

The RE/MAX Housing Market Outlook 2013 examined trends and developments in 26 major markets across the country. The report found that the number of homes sold is expected to match or exceed 2011 levels in 65 per cent of markets (17/26) in 2012, led by strong activity in Western Canada, including Calgary (up 13.5 per cent) and Regina (eight per cent). Eighty-one per cent (21/26) of markets are set to experience average price increases by year-end 2012, with Regina the country’s frontrunner at eight per cent, followed by Hamilton-Burlington, Greater Toronto, and Fredericton at seven per cent and Saskatoon at 6.5 per cent. The forecast for 2013 shows the upward trend moderating, but values still ahead of 2012 levels in 85 per cent (22/26) of centres. Stability is forecast to characterize Canadian real estate in the new year, with sales above or on par with 2012 levels in 81 per cent (21/26) of markets.

Nationally, an estimated 454,000 homes will change hands in 2012, falling one per cent short of the 2011 level of 456,749. Canadian home sales are expected to almost mirror the 2012 performance next year, holding steady at 454,000 units. The average price of a Canadian home is expected to remain stable at $364,000 in 2012 — on par with the figure reported in 2011. Values are expected to appreciate nominally in 2013, rising to $366,500, one per cent above year-end 2012 levels.

The report found that low interest rates were a major impetus in 2012, fuelling sales of homes across the board. Tight inventory levels also factored into the equation early in the year, causing a flurry of activity in many centres. By mid-year, however, the third round of CMHC mortgage tightening had a noticeable impact on housing markets, pushing homeownership beyond the grasp of many first-time buyers.

The RE/MAX Housing Market Outlook Report also identified several regional disparities. Most notable was the pull back in sales activity in Greater Vancouver. A banner 2011 year and a slowdown in investor activity contributed to the trend in 2012. Yet, moderation was more widespread in the east, with half of Ontario and Atlantic Canada markets (8/16) reporting 2012 sales off the 2011 pace. Strength was evident throughout Saskatchewan, Alberta, and Nova Scotia, where exceptionally sound economic fundamentals drove demand. The Prairies also stood out in price appreciation, along with the Atlantic Provinces in 2012, and a repeat is on tap for next year. In 2013, Vancouver will rebound to post the strongest sales gain, while the Quebec markets post the sharpest decrease.

While first-time buyers will continue to have a significant presence in the overall marketplace, they are expected to take a back seat in 2013 in Canada’s largest markets, with move-up buyers the new engine driving home-buying activity. The greatest advance in home sales is expected in Vancouver (12 per cent), Calgary (10 per cent), Halifax(five per cent), Kingston (4.5 per cent) and Saint John (four per cent). The strongest upward momentum in average price in 2013 is forecast for St. John’s (six per cent), Regina (five per cent), Kingston (4.5 per cent), and Halifax (four per cent), followed by Fredericton and Winnipeg at three per cent. More balanced market conditions are expected in 2013 throughout the majority of markets, with supply meeting demand.

Immigration and population growth will continue to support housing demand moving forward. The Canadian government’s commitment to immigration will hold steady, with the country set to welcome as many as 265,000 immigrants in 2013. The greater focus on economic immigrants is already leading to quicker household formation and homeownership than in years past. These two factors will also support the burgeoning condominium segment — along with Canada’s aging population — while the desire for tangible assets props up the upper-end.

Source: Net News Ledger

Canadian housing prices will fall 10% over the next several years and homebuilding will slow sharply in 2013, but the country’s recent property boom is not expected to end in a US-style collapse, according to a Reuters poll.

The survey of 20 forecasters published today showed the majority believe the Canadian government has done enough to rein in runaway prices, preventing the type of crash that has devastated the US market for years.

“This isn’t a sharp correction, this isn’t a US-style correction, it’s just simply an unwinding of the excess valuation that was created by artificially low interest rates for a long period of time,” said Craig Alexander, chief economist at Toronto-Dominion Bank.

“I would emphasize that while a 10% correction sounds scary, in actual fact, this would be a healthy outcome.”

US house prices crashed as a mortgage crisis unraveled in 2008, triggering a financial crisis and leaving a trail of foreclosures, negative equity and financial hardship for millions of people. Housing prices in the US have only begun to rise again this year.

On a national basis, Canadian house prices are expected to drop 10% over the next several years, and housing starts will fall more than 17% to 184,000 units by mid-2013, according to median results of the poll, which was conducted over the last week.

House prices have already begun to cool in some areas but nationally remain 23% higher than their trough in March 2009, according to a Canadian Real Estate Association index.

Respondents in the Reuters poll said house prices will rise 2.0% in 2012 and fall 0.1% in 2013, according to the median of 18 forecasts, putting most of the losses at least two years away.

Median forecasts had Toronto prices rising 5.1% in 2012 and falling 1.3% in 2013. But respondents saw an eventual 5% fall from current levels. Vancouver prices were forecast to fall 2.7% in 2012 and 3.8% in 2013, with an eventual decline of 12.5%.

As sales decline and prices fall, homebuilders will ratchet back on construction starts, the poll showed.

Housing starts, which notched a seasonally-adjusted annual rate of 222,945 units in the third quarter, will decline to 200,500 in the fourth quarter, 186,900 in the first quarter of 2013, and 184,000 in the second quarter of next year, predicts the poll.

Twenty forecasters were polled on Canadas housing market. Here are the results

CANADIAN HOUSE PRICES
A rise of 0.1% in 2012 was the median from 14 forecasts
A rise of 0.1% in 2013 was the median from 12 forecasts

TORONTO HOUSE PRICES
A rise of 0.3% in 2012 was the median from 6 forecasts
A fall of 2.0% in 2013 was the median from 5 forecasts

VANCOUVER HOUSE PRICES
A fall of 3.0% in 2012 was the median from 6 forecasts
A fall of 4.8% in 2013 was the median from 5 forecasts

2a. If you think Canadian house prices will fall, how much (in percentage terms), will they drop from here?

5.0% was the median from 9 forecasts. Forecasts ranged from 0.0% to 25.0%.

2b. When will they stabilize?

1 said Q1 2012 1 said Q2- Q3 2012
1 said Q4 2013 1 said Q1 2014
1 said Q1 2015 2 said 2015

3. On a scale of 1 to 10, where 1 is extremely undervalued, 5 is fairly valued and 10 is extremely overvalued, what best describes the current average level of Canadian house prices relative to fundamentals?

7 was the median from 14 forecasts. Forecasts ranged from scale of 5 to 8

4. Do you think the Canadian government will tighten mortgage rules within the next 12 months in an attempt to cool the housing market?

10 said yes
4 said no

Source: Andrea Hopkins, Reuters

Calgary and Edmonton are now the top cities for real estate investment, according to a new report from PwC and the Urban Land Institute, which says the two Alberta cities have displaced Toronto and Vancouver for 2013.

Investors will favour apartment and office buildings next year while developers will focus on the retail market but overall the report says mediocre will be the new measure of what defines a good market.

The report, which reflects the views of over 900 individuals throughout Canada, the United States and Latin America, says “compared to everyone else Canada will do very well” which seems to be the theme across the country.

“The Canadian real estate community understands real estate fundamentals and knows how to react to fluctuations in monetary policy and capital markets. Canada’s real estate industry continues to operate well despite uncertainties in domestic and global economies,” said Lori-Ann Beausoleil, PwC Canada’s real estate leader.

Suggestions that emerged from those who participated in the survey:

• Core real estate in major markets should be held, which for institutions means a place to keep their money in “income-producing trophy properties” across all property classes.

• Green offices are something major tenants want and they are willing to move from older buildings if they can get an advantage form a new one.

• Land bank out west because the escalating inflow of workers will continue unless there is reversal in energy and commodity markets.

• Infill sites represent intensification opportunities, especially ones located near mass transit.

• There are still opportunities for home builders to construct large layouts which is an under served market, as soaring condo prices and “unfriendly units” create an opening for that segment.

• If luxury condos dip, buy. Increased urbanization will continue and upscale space and the best downtown locations will reclaim any lost value quickly.

Calgary got the top spot in the survey as rents are rising in the oilpatch and acquiring real estate is becoming more difficult. The report predicts more of the same in 2013 with a focus on demand for office and industrial space.

John O’Bryan, chairman of CBRE Canada, who spoke about the Canadian commercial market at conference to discuss the report, says the employment numbers just lean towards the west. “Anywhere that has any resource base is doing exceptionally well,” he said.

Mr. O’Bryan said 2012 might be called the year of the real estate investment, highlighted by Dundee REIT’s $1.266-billion purchase of Scotia Plaza in Toronto with partner H&R REIT which occurred right under the nose of the pension funds.

“It’s almost the perfect environment for them,” said Mr. O’Bryan, about REITs. “Take office buildings, two thirds of all of the transactions have been REITs. Conditions can’t be any better. They’ve got the balanced sheets, they’re proven in the capital markets.”

Source: Garry Marr, Financial Post

The Greater Vancouver housing market saw a slight increase in the number of home sales, a slight reduction in the number of listings, and a slight decrease in home prices in October compared to the summer months. With those changes, the sales-to-active-listings ratio increased to 11 per cent in October from 8 per cent in September.

The Real Estate Board of Greater Vancouver (REBGV) reported 1,931 residential property sales of detached, attached and apartment properties on the region’s Multiple Listing Service® (MLS®) in October, a 16.7 per cent decline compared to the 2,317 sales in October 2011 and a 27.4 per cent increase compared to the 1,516 home sales in September 2012.

October sales were 28.5 per cent below the 10-year October sales average of 2,700.

“Buyer demand increased slightly in October compared to the previous few months,” Sandra Wyant, REBGV president-elect said. “Overall conditions in today’s market remain in favour of buyers, with low interest rates, more choice, and less time pressure in terms of decision-making. This translates into a calmer atmosphere for those looking to buy a home and it places more onus on sellers to ensure their homes are priced to compete in today’s marketplace.”

New listings for detached, attached and apartment properties in Greater Vancouver totalled 4,323 in October. This represents a 1.2 per cent decline compared to October 2011 when 4,374 properties were listed for sale on the MLS® and an 18.8 per cent decline compared to the 5,321 new listings in September 2012.

At 17,370, the total number of residential property listings on the MLS® increased 12 per cent from this time last year and declined 5.3 per cent compared to September 2012.

Since reaching a peak of $625,100 in May, the MLS Home Price Index® (MLS HPI®) composite benchmark price for all residential properties in Greater Vancouver declined 3.4 per cent to $603,800 in October. This represents a 0.8 per cent decline compared to last year.

“There’ve been modest price changes since they peaked in the spring. The largest reductions have occurred in the areas and property types that experienced the biggest price increases over the last few years,” Wyant said.

Since hitting a record high in April, the benchmark price of a detached home on the Westside of Vancouver has declined 8.6 per cent while detached homes in Richmond and West Vancouver have seen declines of 6 per cent over the same time period.

Sales of detached properties in Greater Vancouver reached 790 in October, a decrease of 18.9 per cent from the 974 detached sales recorded in October 2011, and a 19.1 per cent decrease from the 976 units sold in October 2010. Since reaching a peak in May, the benchmark price for a detached property in Greater Vancouver has declined 4.1 per cent to $927,500.

Sales of apartment properties reached 803 in October 2012, a 16.2 per cent decrease compared to the 958 sales in October 2011, and a decrease of 18.4 per cent compared to the 984 sales in October 2010. Since reaching a peak in May, the benchmark price for an apartment property in Greater Vancouver has declined 2.9 per cent to $368,800.

Attached property sales in October 2012 totalled 338, an 11.5 per cent decrease compared to the 382 sales in October 2011, and a 10.3 per cent decrease from the 377 attached properties sold in October 2010. Since reaching a peak in April, the benchmark price for an attached property in Greater Vancouver has declined 2.9 per cent to $457,700.

Source: Real Estate Board of Greater Vancouver