Real Estate Outlook Suggests No Surprises in Store, Kamloops Daily News
This article appeared in the Kamloops Daily News on December 18th, 2012 and was written by Mike Youds.
Housing market analyses twinkle like the stars as people search for signs of where the economy might be heading in 2013.
The Canadian Real Estate Association is the latest to weigh in, trimming its sales forecast for this year and next. The industry association expects home sales this year to slip 0.5 per cent relative to 2011. Just three months ago, it was projecting a 1.9 per cent rise.
Sales next year are expected to drop another two per cent.
While that’s not great news for those hoping for signs of a stronger economic recovery, it’s not the sound of a bubble bursting, either.
At best, there are faint signs that the market is moving in any direction.
Overall, the province is tracking downward in dollar value and in sales, but that trend is driven by Vancouver and Victoria, where markets have softened, said Dave Peressini, president of Kamloops and District Real Estate Association.
“I think at the end of November we were up about three per cent, but you’re really looking at a local market,” Peressini said. “The fact that we are holding on in sales and dollar value up a little bit, I think tells you the market will be that way in 2013.”
The average Kamloops MLS price in the third quarter of 2012 was $369,000, showing a 3.1 per cent rise over the same quarter last year.
Peressini finds more encouraging signs over the long range.
“We do have an expanding population and some fairly strong, long-term employers and low mortgage rates. The economic fundamentals are there.”
The CMHC recently released a forecast calling for very modest increases of housing starts in Kamloops in 2013, said Paul Fabri, a Kelowna-based analyst with the Crown corporation.
“That’s consistent with the forecast for the province overall.”
There were 23 housing starts in Kamloops last month compared with 24 for the same month in 2011.
“The difference is, essentially, one housing project,” Fabri said.
There were 17 single-detached starts in November, down from 23 in November 2011. Growth in the multiples market, to 29 from 12, almost made up for the difference.
Overall in 2012, single-detached starts rose to 250 from 225 last year while multiple starts went in the opposite direction, dropping from 258 to 185.
The figures indicated that local new-housing market is in a period of stability rather than growth, but that’s preferable to the market declines and possible collapse some were predicting earlier in the year.
Scotiabank reported last week that the Canadian housing market seems to have made a soft landing with cooler but steady sales and price stability.
Nationally, sales in October were down about 10 per cent from the spring, but only marginally below the average pace of the past decade, reported bank economist Adrienne Warren.
Some of that adjustment could be attributed to regulatory changes that took effect in July, including a lowering of the maximum amortization period to 25 from 30 years.