The Canadian Real Estate Association has been adjusting its forecast for 2011 as economic circumstances warrant, and on Monday took another crack at the numbers.
Its first prediction was made in February, 2010, when it said prices would fall 1.5 per cent as sales fell 7.1 per cent.
Monday’s numbers were rosier, as stronger than expected sales across the country and high prices in B.C. caused the trade association to amend its outlook to a 1.3 per cent decline in sales and a 4 per cent gain in prices.
Here’s how it got there:
Initial forecast for 2011, February 2010
Sales: -7.1 per cent
Prices: -1.5 per cent
“Interest rate increases will contribute to weaker national sales activity in 2011.”
June, 2010 forecast for 2011
Sales: -8.5 per cent
Prices: -2.2 per cent
“While sales activity is unfolding as expected in Ontario, the decline in affordability in British Columbia impacted sales in the province during the first quarter. Additionally, changes to mortgage regulations announced in February are expected to marginally impact activity.”
July 2010 forecast for 2011
Sales: -7.3 per cent
Prices: 0.9 per cent
“Weaker than anticipated sales activity during the crucial spring home buying season in Canada’s four most active provincial markets prompted the revision. The decline is consistent with the exhaustion of pent-up demand from deferred purchases during the economic recession, and sales having been pulled forward into early 2010 due to changes in mortgage regulations.”
November, 2010
Sales: -9 per cent
Prices: -0.8 per cent
“Sales activity in the third quarter of 2010 began on a weak footing, but gained traction as the quarter progressed. Improving momentum for home sales activity suggests the resale housing market is stabilizing, but weaker than expected third quarter activity has reduced CREA’s annual forecast.”
February, 2011 forecast for 2011
Sales: -1.6 per cent
Prices: 1.3 per cent “The upward revision to CREA’s forecast for 2011 reflects recent improvements in the consensus economic outlook and a further expected improvement in consumer confidence.” May 9 forecast for 2011 Sales: -1.3 per cent Prices: 4 per cent
“Although sales activity in the first quarter of 2011 came in largely as expected, multimillion dollar property sales in Greater Vancouver have surged unexpectedly. These sales have upwardly skewed average sale prices for the province and nationally, prompting the average price forecast to be revised higher http://www.theglobeandmail.com/report-on-business/economy/economy-lab/daily-mix/how-the-home-price-forecasts-changed/article2016467/