Three years of rising prices and increasing sales in Canada™s housing market have ended, according to a national housing market outlook for 2003 released today by Century 21 Real Estate Canada Ltd.

Don Lawby, President and COO of CENTURY 21 Canada, says confirmation of a cooling market comes from CENTURY 21 brokers who are reporting a slowdown in November sales activity in many areas compared to November sales in the previous three years.

"After a record-setting three years of unit sales growth, the market is now virtually saturated. There's a finite number of people who want to buy houses, and I think we've reached it in many regions," says Lawby. "In the 21 markets surveyed, Multiple Listing Service® data shows the number of unit sales has increased by an average of 41 percent over the past three years. But Lawby says it seems that the trend will not be maintained when the figures for November are published next month.

Interviews with CENTURY 21 brokers in 21 major centres across the country show that they expect 2003 to herald a more normal market in many areas. They say supply and demand will be in balance, which will mean a wider choice for buyers and fewer multiple offers. Prices are expected to stabilize around current levels.

Although there will be exceptions in specific regions due to local economic conditions, overall, 2003 will see a return to the type of stable market activity last seen in 1998, says Lawby.

"I believe the number of residential units sold will drop 10 percent to 15 percent and that prices will hold steady, with increases matching the inflation rate. I'm not suggesting that the bubble will burst, because there's been no bubble in the Canadian real estate market. We will have a healthy market, but there will be no more talk of real estate leading the economic recovery."

Published: November 29, 2002

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