The Canadian Real Estate Association has made an announcement on Monday declaring that it has reduced its expected sales forecast of this year, in view of the recently slower sales of November due to the strict lending rules which were implemented this summer. The industry association claims to have estimated an almost 0.5 percent decrease in house sales this year. This figure when compared with the previously forecasted value, in September, was almost an increase of 1.9 per cent, i.e. 466,900 units.
Now CREA announces that it has estimated that sales in the coming year will also decline to roughly 2 percent, i.e. 447,400, which is slightly higher than previous estimated decline of 1.9 percent, i.e. 457,800 unites. The Chief Economist of CREA, Gregory Klump, announced that “annual sales in 2012 reflect a stronger profile prior to recent mortgage rule changes followed by weaker activity following their implementation.” He also added that “by contrast, forecast sales in 2013 reflect an improvement from levels this summer in the immediate wake of mortgage rule changes. Even so, sales in most provinces next year are expected to remain down from levels posted prior to the most recent changes to mortgage regulations.”
The move to stricken mortgage rules was led by the Finance Minister, Jim Flaherty, in July mending rules for the fourth time with hope of discouraging Canadians from taking on too much debt. Along with other amendments, Flaherty increased the mortgage payments while decreasing the maximum amortization period to 25 years.
Strictly Necessary Cookies
Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.
If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.