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After setting the fifth consecutive
annual record in 2005 at
483,250 units, CREA expects
national resale housing activity
to inch even higher by 1.0 per cent to
488,160 units in 2006. Activity is then
projected to ease by 3.3 per cent in 2007.
Rising interest rates have so far done
little to cool resale housing transactions
this year. In the first quarter of 2006,
sales activity reached its highest level for
any quarter on record in Alberta, Prince
Edward Island and Newfoundland, and
remained exceptionally strong in all
other provinces. Alberta is expected to
post the biggest annual increase in
transactions this year, which reflects its
upbeat economic, employment and
population growth prospects arising
from investment in the energy sector.
After climbing 10.2 per cent in 2005,
CREA projects that the national MLS®
residential average price will increase by
a further 6.1 per cent in 2006 and 4.7
per cent in 2007. Annual increases in
average price are expected to remain
above 10 per cent in British Columbia
and Alberta, where resale housing
markets should remain tight.
| MLS® residential unit sales forecast |
2005 |
Annual change (%) |
2006 Forecast |
Annual change (%) |
2007 Forecast |
Annual change (%) |
| Canada |
483,250 |
4.9 |
488,160 |
1.0 |
472,245 |
-3.3 |
| British Columbia |
106,310 |
10.3 |
101,500 |
-4.5 |
98,485 |
-3.0 |
| Alberta |
65,866 |
14.6 |
75,390 |
14.5 |
71,490 |
-5.2 |
| Saskatchewan |
8,312 |
1.7 |
8,325 |
0.2 |
8,245 |
-1.0 |
| Manitoba |
12,761 |
5.5 |
12,410 |
-2.8 |
12,005 |
-3.3 |
| Ontario |
197,024 |
-0.2 |
198,765 |
0.9 |
193,700 |
-2.5 |
| Quebec |
70,649 |
2.0 |
67,565 |
-4.4 |
65,160 |
-3.6 |
| New Brunswick |
6,836 |
14.3 |
7,180 |
5.0 |
6,900 |
-3.9 |
| Nova Scotia |
10,387 |
16.9 |
11,390 |
9.7 |
10,970 |
-3.7 |
| Prince Edward |
1,449 |
-3.4 |
1,590 |
9.7 |
1,505 |
-5.3 |
| Island Newfoundland |
3,211 |
-1.7 |
3,615 |
12.6 |
3,355 |
-7.2 |
| MLS® residential unit sales forecast |
2005 |
Annual change (%) |
2006 Forecast |
Annual change (%) |
2007 Forecast |
Annual change (%) |
| Canada |
$249,311 |
10.2 |
264,519 |
6.1 |
276,951 |
4.7 |
| British Columbia |
$332,224 |
14.9 |
367,108 |
10.5 |
401,983 |
9.5 |
| Alberta |
$218,266 |
12.1 |
249,915 |
14.5 |
283,653 |
13.5 |
| Saskatchewan |
$122,765 |
10.8 |
130,622 |
6.4 |
137,414 |
5.2 |
| Manitoba |
$133,854 |
12.3 |
146,570 |
9.5 |
156,830 |
7.0 |
| Ontario |
$263,041 |
7.3 |
278,560 |
5.9 |
291,096 |
4.5 |
| Quebec |
$184,583 |
7.9 |
192,335 |
4.2 |
199,644 |
3.8 |
| New Brunswick |
$120,641 |
6.8 |
126,552 |
4.9 |
131,868 |
4.2 |
| Nova Scotia |
$159,556 |
9.3 |
171,523 |
7.5 |
182,672 |
6.5 |
| Prince Edward |
$117,238 |
5.8 |
123,100 |
5.0 |
127,285 |
3.4 |
| Island Newfoundland |
$141,167 |
7.4 |
148,931 |
5.5 |
155,633 |
4.5 |
"Further increases in home prices and
interest rates may cause resale housing
activity to ease next year, but housing
demand will remain very strong and
support further price increases," said
CREA's Chief Economist Gregory Klump.
"Rising household incomes will help
to support housing affordability," says
Klump. "The tax cuts outlined in the
2006 Federal Budget will ease the
overall tax burden for individuals, put
money back in the pockets of Canadians,
and increase consumer confidence about
making major purchases."
"The reduction in the GST rate to six
per cent and the one per cent reduction in
the federal portion of the HST will reduce
the costs associated with buying, selling
and owning a home,"Klump continues.
"With all of these new tax reductions
and the continuing strength of the real
estate market, consumers can count on
their REALTOR® to have the most up to-
date information on how the changes
will impact them," said Alan Tennant,
FRI, President of The Canadian Real
Estate Association.
CREA's Chief Economist notes that the
GST is charged on professional services
used by consumers during the course of a
housing transaction, such as fees paid to
lawyers, appraisers, home inspectors and
REALTORS®.The tax is also charged on
the goods and services purchased by
consumers when they move from one
home to another. These include moving
costs, renovations, and the purchase of
furniture and major appliances.
For more information please contact
Gregory Klump, CREA's Chief
Economist on gklump@crea.ca
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