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Canada's 2 biggest housing markets cooling?

These summer days are long and hot, but there’s a definite cooling in the country’s two biggest housing markets.

In Vancouver the local real estate board reports a sharp, 17% drop in sales in June, compared to May and a, nearly, 28% slide compared to a year ago. There are signs foreign investors have lost interest in Vancouver and buyers are backing away from deals because they find themselves too close to the debt-load maximums set by Ottawa. Buyers, it seems, are heeding the warnings of impending interest rate hikes.

While the benchmark price of a detached home in Vancouver is holding steady at a little more than $960,000 economists are predicting a 15% correction for the market. And realtors report sellers are starting to cut their asking prices, hinting at a turn to a buyers’ market for Canada’s most expensive realestate.

In Toronto the smoking hot condo market, that has the finance minister so worried, has taken a splash of cold water. Sales of, mainly existing, down town condos fell 18% in June, compared to a year ago. (Preconstruction sales through May were down 22% compared to last year. But 2011 was the best year ever for preconstruction sales.) And while, like Vancouver, some economists are callingfor a 15% price correction for Toronto’s condos, prices edged up 4% in May and 2% in June compared to a year ago.

Source: First National LP Corp Residential Market Update

www.christinebuemann.com

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