Landcor data is out and in the first three months of 2010 both the number and value of BC real estate transactions dropped more than 25% from the previous quarter.
The results quantify the trend economists such as Cameron Muir, chief economist for the B.C. Real Estate Association, have observed occurring since January.
Landcor’s numbers “certainly support the data we’ve been looking at that shows that obviously the pace of sales have slowed since the last quarter of 2009,” Muir said in an interview.
Last year’s “fourth-quarter peak is unlikely to reoccur in 2010.”
Landcor president Rudy Nielsen said B.C. home sales typically slow at the beginning of the year, but the first-quarter of 2010 slowed more than usual compared with the last decade of results. This is in part, he believes, because of the Olympics.
Nielsen added that consumer uncertainty over a host of issues, ranging from the global economic situation to unknown effects of the harmonized sales tax, have consumers sitting on their wallets.
The agency, which insures almost $500-million of Canadian mortgages, said the average cost of a home by the end of 2011 should be $350,000. That would be a gain of 1.4 per cent over April’s record high of $344,968.Forecasting higher prices next year puts the agency at odds with the Canadian Real Estate Association and Toronto-Dominion Bank, both of which are calling for prices to drop by 1.5 per cent and 2.7 per cent respectively in 2011.
It has been difficult to accurately make forecasts on the housing market through the recession, however. Its forecast for 2009 housing starts was off by 19.4 per cent. The agency was only off by 1.5 per cent the previous year, and its goal is to always be within 10 per cent of the actual figures.
“For the first time in several years, our forecast accuracy was not within the 10-per-cent range because of volatile market conditions,” it said.
A ten percent margin of error eh? Coincidentally Dan in Calgary points out that the phrase ‘CMHC is forecasting’ is a perfect anagram for ‘Comic things, farces‘