OTTAWA - An expected drop in home sales across Canada this year will be less than previously forecast because of stronger sales of mega-homes in British Columbia in the first quarter, the Canadian Real Estate Association said Monday.
CREA now expects that unit sales for 2011 will dip 1.3 per cent to 441,100, less than the 1.6 per cent decline it forecast in February.
National sales activity of homes sold on CREA's Multiple Listing Services should rebound by 2.6 per cent to 452,000 units in 2012, it added.
That's in line with the previous forecast and the 10-year average for annual activity.
Sales activity in the first quarter was skewed by an unexpected surge in the sale of multimillion-dollar homes in Greater Vancouver. The average price forecast in the province and nationally has also been revised higher.
The national average home price is forecast to rise four per cent in 2011 to $352,500 and by 0.9 per cent to $355,800 in 2012.
Vancouver residential sales are being pushed by foreign investment, which is showing no signs of slowing, said CREA chief economist Gregory Klump.
He said changes to mortgage regulations brought forward some sales activity that would have otherwise occurred later in the year.
"This is likely to result in a milder version of the volatility in sales activity that we saw last year."
CREA expects home sales activity to regain traction after dipping in the second quarter as economic recovery and hiring continues.
Although interest rates are expected to increase later in the year, they will still be supportive of housing sales, as will continuing job growth, he added.
CREA has said that this year's real estate market is poised to reflect a slightly less distorted version of last year, when sales spiked in the early months of the year before dropping to a trough in the summer as a string of regulatory changes impacted the market.
