National home sales to drop 17 per cent in '09; prices predicted to fall 8 per cent

By The Canadian Press

OTTAWA - House prices are expected to fall eight per cent across Canada this year and sales are predicted to slip nearly 17 per cent, according to a new report from The Canadian Real Estate Association.

The association, known as CREA, said sales on the benchmark Multiple Listings Service fell 17.1 per cent in 2008. It said sales are expected to fall another 16.9 per cent to 360,900 units in 2009 - which would be the lowest level for national sales activity since 2000.

Sales are expected to fall in every province, led by declines in British Columbia, Alberta and Ontario.

CREA predicts sales to rebound by 9.9 per cent to 396,600 units in 2010, with the biggest recovery forecast for B.C. and Alberta.

Prices are expected to drop eight per cent this year, with figures falling most in Western Canada and Ontario.

Meantime, the average home price in Newfoundland & Labrador is forecast to rise 4.8 per cent in 2009.

CREA said it expects prices to stabilize in 2010, with annual price increases of one per cent or less in five provinces.

The report comes the same day Canada Mortgage and Housing Corp. said housing starts slipped by 10.9 per cent to 153,500 units in January, compared to the month before.

Economist say that is the largest per cent monthly drop since March 1995.

What a crazy year. What a mad 6 months, an outlandish September to October. Oil soaring to $147, then crashing to $37. Stocks on average down 45% or more, the whole world seemingly a’flame.


Enough is enough!
We have to work on the positive. The fact remains that the best market remains between your own ears. We CAN be contrarian, we do NOT have to watch the ongoing barrage of bad news nor listen to people that have been wrong all year anyhow. It is a fact that stock markets historically returned within 2 years after collapses, it is a fact that your cash flow property still does - well - cash flow. Facts: That our shopping centres are full, that our unemployment rate stands at 5.4% and our huge capital investments and strong inward migration are for real. We KNOW, that we have come through some tough times before and that - in the end - it is how we feel ourselves that is the most important. Stop listening and worse stop REPEATING the negative stuff. In 2009, when someone asks: “How are you?” Say: “Wonderful”. It is the truth anyhow, we do live in paradise. When someone says how is y our business, say: “Great, never better!” Get positive. You attract what you think about.
In a world of “The Secret”, everyone professes to understand the “Law of attraction”, but few will act on the message. We understand, but we do not do. Or actually we talk negative - regurgitate the world’s calamities, we express little hope and we do not realize that the Law of Attraction is working! It gets you more of the same!

Say: “ENOUGH IS ENOUGH!”
I assure you this 18th of December that those of us that look for the positive, that stretch towards the good … that reach for a better thought and reflect a positive strong attitude WILL attract a fantastic 2009. Don’t follow the negative crowd. Switch them off.

Get rid of negative people … Like attracts like … birds of a feather flock together. Stay with positive people … and if you feel depressed and can’t feel positive right away, well, don’t wallow, get mad … mad is better than depressed. Then after mad, you feel frustrated - good … that is better than being mad … and after frustrated there comes a shrug and a get into an ‘action feeling’. (It is a fact that 80% of what we worry about never happens anyway.) Then … a giggle … and after that the positive: “Yeah, I know that me and mine will have a wonderful future. To everyone that depends on me I will reflect a positive outlook.” Do it!

Major Point: So yes, it starts right here, right now. In your own mind. Here are some other facts:

1. Stock markets have crashed and recovered a dozen times … they always recovered … yet when in the collapse, there seemed no end in sight. This one will recover too. Good.

2. There will be great demand for real estate. Already in the US we have a huge increase in distressed sales. Once they are gone, market will continue to rise. Opportunity will make some rich. Good.

3. Oil and gas prices are down, putting about $7 billion in Canadian pockets next year. Good.

4. There will be a dozen deals of a lifetime. I.e. a 3-year-old $60,000 (lease return) American SUV will go for under $20,000. Good.

5. Food costs will be cheaper. Good.

6. The bad companies, the bad products, the overbuilt real estate condo areas will all continue to be cleared out or crash and burn. Good, they should.

7. As investors we will not so readily trust someone else to manage our money. We will do some learning and not get scammed as easily. Good.

8. Lousy securities and fad products will not be tolerated or trusted and will die. AAA ratings will be checked. Good.

9. More stock investors will come to real estate. Good.

10. 30-year money in the US and 5-year money in Canada will be around 4.5% next spring. Good.
You make your own list. Try this: Whenever someone talks about how bad the economy is, ask him or her how she is doing. 80% of the time, people tell me, that they themselves are actually doing quite well … but they hear someone is not or may not be in future.

Be a contrarian: Love your life, love your family, love your community, love your country … and in the process become more of a human being than a human doing.

Yes, 2009 will be fine.