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Old 2008-07-17, 05:20 PM
klieu klieu is offline
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Housing Prices Drop Across Canada, But Ontario Still Strong
Wednesday July 16, 2008 Staff

It's a buyers market across the country for the first time in a decade as the red hot real estate market appears to be cooling off, but there's no need for Torontonians who are hoping to make a tidy profit on the sale of their home to worry.

For the first time since 1999 the average price of a Canadian home dropped in June compared to the same month last year, but Ontario appears to have bucked the trend reporting higher than average prices.

A slowing economy and high energy costs are the likely culprits behind the slumping market.

"Last year, it was really crazy in Toronto," notes Maureen O'Neill from the Toronto Real Estate Board.

"We didn't have the inventory. What we did have was a supply and demand situation, and everybody wanted Toronto. Everybody wanted to come here."

And that triggered a huge boom.

"People were lined up to buy homes, and because prices were increasing so rapidly, everybody wanted to get into the market. They were afraid to wait in case it really became unaffordable for them," O'Neill relates.

But all that's changed.

"Consumer confidence is a little bit lower. They're starting to say, hey, you know, I don't want to get into a multiple offer situation. I'm going to take my time. And because we have a lot of properties out there now, they can afford to do that," she points out.

New buyer Steven Carter, pictured above in the white shirt, is glad he waited.

" I wouldn't have bothered last year. It was too crazy," he claims.

"I had friends who bought last year," Carter adds.

"I don't even know if they're still together some of them. It was very stressful last year," he says, laughing.

Multiple Listing Service (MLS) reported a 0.4 percent drop in the price of the average residential property in June to $341,096.

And on Tuesday the Canadian Real Estate Association said the number of new listings across Canada in June rose to 56,639 - a 6.2 percent increase from the same time last year - but the sales of existing homes on the market dropped by 15 percent, leaving an excess amount of properties on the market.

The nation-wide drop is attributed to the decline in the real estate market in Calgary and Edmonton where housing costs shot up dramatically in a short period of time.

"Some of that is coming in cities where prices had gone through the roof in the previous one or two years," Avery Shenfeld, senior economist at CIBC World Markets, said. "So we have to take small retreats in some of those markets with a bit of a grain of salt."

But Toronto is safe - for now.

" "I don't think Toronto's going to be touched just because of everybody wants the urban centre right now. So I think Toronto will kind of not feel the pinch," O'Neill beams.
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