I guess government might have realised that there might be possibility of economic slow down comming to Canada. That may be one of the reason why government is unlocking RRSP for people in financial hardships.

http://www.thestar.com/News/Canada/article/423058

http://www.canada.com/calgaryherald/news/story.html?id=1afda6d4-6500-4885-ab41-b1470bb29b5c


Calgary's MLS listings are currently "totally out of whack" surpassing the 10,000 mark in April and growing by the day while at the same time sales are slumping.

Listings are at an all-time high for single-family homes and condominiums and they are being described as "extraordinarily high."

April MLS sales for single-family homes (1,363) in Calgary metro were the lowest for the month since 2000 while condo activity (581 sales) was the slowest since 2003 - even before the years immediately leading up to the city housing market boom in 2006 and 2007.


If inventory was a tenth of what it is right now," overall sales would still be pretty good, said Gary MacLean, a realtor with Re/Max Real Estate Central.

"But we have an inventory that is way out of control."

MacLean said there are a few reasons for the continuing rise in active listings in the Calgary real estate market.

"You almost look at it like a perfect storm," said MacLean. "You've got cost of living issues. People's disposable incomes are being eroded quickly by food prices, gasoline, heating, and electricity. The cost of living in this town is going through the roof.

"The other factor is a lot of people got in the market when it was peaked and paid a lot for their house . . . With the cost of living going through the roof, the first thing to go is the house because they're over-extended. They're house poor."

MacLean said recent data showing declines in housing starts and residential building permits also have a ripple effect on the local real estate market, as do speculators.

"Those are the people that went out and bought four, five, six, seven condos in a building that wasn't going to be built for two years. All of those buildings are now being completed. Those people did not want to be landlords. They were going to buy the condo, hold it until the building came due and put it on the market," said MacLean. "Well the problem is of course we have the highest number of condos in history for sale."

At the end of April, the Calgary Real Estate Board was reporting the month-end inventory in Calgary metro for single-family homes at 6,881 listings (2,881 in April 2007) and 3,214 for condos (898 in April 2007). The average MLS sale price for a single-family home in April in the city was $474,564, up 0.07 per cent from a year ago while condos dropped by 5.11 per cent to $312,586.

As of Friday, CREB's website was reporting active listings for single-family homes in the city were 6,999 with 1,369 sales in the past 30 days.

Total MLS inventory at the end of April under CREB, including towns outside Calgary, acreages and rural land, was 14,480, up more than 155 per cent from the 5,665 at the end of April 2007.

"We've never had anything like this . . . It is totally out of whack," said MacLean, adding the inventory keeps rising every day with sales not keeping pace. "March, April, May are the three best months of the year (for sales). We're not getting that. It's actually falling.

"We have a giant inventory and we're adding to it by hundreds a day. I don't see anything good coming out of this. It's a supply and demand scenario and prices rise when supply is low and prices fall when supply is high. And this is as high as it gets."

Anyone who neglects to acknowledge the risk and expertise needed to sell a home is pleading ignorance. Its a realtors job to write enforceable contracts, foresee potential problems, and protect their client, and any one who claims to have the expertise to do that as well as a good realtor is full of it. If they are best lawyer in the town then you are in great hands.

http://www.four-pillars.ca/2008/02/18/why-you-cant-trust-real-estate-agents-when-buying-a-house/

http://www.four-pillars.ca/2008/03/24/do-not-trust-your-real-estate-agent/

For anyone who is interested in reading economic forecasts (but does not believe in reports from RE institutions), this report from TD should be quite an interesting read. Since it is very long, I am only including the link. However, the last two pages sum up the conditions. Based in Ontario, I am more concerned with it and the prediction is that the sales will certainly drop (forecast is -4% for year 2008) whereas the price is still forecasted to rise by 4.4%.

http://www.td.com/economics/special/ca0408_housing.pdf

And while you are at it, the following two links will enhance the knowledge of differences between the U.S. & Canadian markets.

http://money.aol.ca/article/subprime-alt-a-mortgage-delinquencies-rising-sp/237898/

http://www.cbc.ca/news/background/personalfinance/mortgage-meltdown.html

I am not trying to change anyone's mindset. One thing for sure though that I trust these forecasts are coming from well known economists.

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Thanks Rajeev.... nice post.

Oil hit $135 a barrel this week, and will go higher. Goldman Sachs is thinking $200 / barrel within 2 years.

Another Canadian bank is proclaiming that the Canadian housing boom is over. We all know Alberta's market is slumping and Canada's is slowing dramatically.

There are 17286 properties for sale in Greater Vancouver.

There is an 11.2 month supply of homes in the US.

Victoria, of course, is no different. Sales have slowed. Inventory doesn't stop rising. Right now, we are at 4522 properties for sale in Greater Victoria.

Calgary:
Data Last Updated May 25, 2008
Total Properties 16050 - Res 10063 - Condo - 4317 Acreage - 1002

Just wondering if anyone can provide same kind of number from GTA or Estern Canada? How number has changed from last couple of months?

Home sales plunge from last year's levels

http://www.canada.com/calgaryherald/news/calgarybusiness/story.html?id=30d8c64a-09b4-4784-bf69-522215febaee&p=1

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.................Despite the declining sales from 2007, CREB president Ed Jensen said the real estate market in the city is steady.

"I've heard that some buyers are sitting there waiting, trying to time the marketplace . . . Why wait until the sale is over and then decide to buy? . . . We've got a good inventory out there. All the (economic) factors speak well -- interest rates. The buyer factors are there with a good underlying strong economy. Our sales statistics have normalized. They've been steady right from January 1st and they remain steady," said Jensen.

The month-end inventories of residential properties in both markets have skyrocketed compared with a year ago -- single-family homes up by 390 per cent to 7,099 listings and condos up by 182 per cent to 3,308 listings.

"Today we have selection. I can find what I want. I can negotiate. I can find the exact house almost to the paint colour," said Jensen.

"We just have a surplus of inventory and that won't last forever. I think it's a matter of months not years to turn this around."..................................

No such plunges in the GTA as far as I've heard. Not to say we're immune. The property market isn't AS hot for sure, but its stil pretty darn hot. There's no significant decline in prices that I can tell from last year, rather my impression is they've gone up.

What's also gone up however and this may be a sign of cooling down is the time-frame in which homes sell. Its taking a bit longer.

Disclaimer : I have done no extensive research in this area, these are things I hear from friends who're buying and selling.

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