Canada is hot-hot-hot
Canadians seem to be in the throes of a home-buying frenzy. To wit: The number of home-sale transactions in Canada is projected to rise by 8% this year (as opposed to a 5.7% decline in the U.S. seen by the National Assn. of Realtors).
And the average price, nationwide, should pop up by 9.5% to about $285,000. (The realtors association doesn’t calculate a U.S. average sale price, but it predicts that the 2007 median -- the point at which 50% of homes sold for less and 50% for more -- will decline 1.4% this year, to $218,800.)
The Canadian data come from a recent report from Royal LePage Real Estate Services, a leading real estate franchiser based in Toronto. Independent data from the Canadian government second those findings.
The most intense activity is in cities in western Canada, said Phil Soper, chief executive of Royal LePage, who described the market in the rest of the country as healthy. Still, he said, he is surprised at the buoyancy.
“In 2006, we saw a slight decrease in the number of homes trading hands, just down 1%, and the consensus forecast was that 2007 would see a decline too -- not in prices but in the number of homes trading hands. What occurred instead was a real turnaround in activity,” Soper said.
What’s fueling the pace, he said, is an unemployment level at a 20-year low and a boom in the Canadian dollar, which is nearly equal to the U.S. dollar.
Soper said his nation has a couple of factors that would mitigate a “big, big correction” like the market changes going on here. Canada’s market hasn’t seen much of the delirious speculator activity that propelled our housing run-up for about five years. And then there’s that sub-prime mortgage factor.
The “fiasco” can’t happen, he said, “because there is no sub-prime lending market.”