Market slumps in December

_{By Vernon Clement Jones | 14/01/2013 8:00:00 AM | 1 comments} 

 

 Market slumps in December

 

There’s yet more indication brokers will see a quiet winter, with national home sales slipping 17 per cent in December from a very active year ago.

"National sales activity continues to hold fairly steady at lower levels since mortgage rules were changed earlier in 2012, said CREA President Wayne Moen Tuesday, “but there are still some real differences in trends between and within local housing markets."

More generally, national home sales edged 0.5 per cent lower in December 2012 compared to November, and actual activity was down 17.4 per cent year-over-year.

The one bright spot for brokers, perhaps, is the falling number of listings, said one analyst. They dropped 1.3 per cent from November to December, something that may encourage buyers now in the marketplace to act sooner rather than later.

Still, the challenge of new mortgage rules introduced in July remain, with many brokers now writing off the possibility of a repeat of last winter’s brisk activity. That activity was spurred, in part, by unseasonably warm weather.

In 2012, a total of 453,372 homes traded hands over the Canadian MLS system, which represents a decline of 1.1 per cent from 2011 and 1.4 per cent below the 10-year average.

The downward trend is actually in line with projections for this year, with Jim Flaherty’s new mortgage rules bearing the brunt of any blame.

More good news for brokers is that those rules aren’t expected to tighten any further this year. The Finance minister has suggested the government is satisfied that its move to lower the amortization on insured mortgages, along with other key changes – in addition to OSFI’s new lending guidelines – have already begun to de-accelerate consumer debt.