Weaker than expected sales in B.C. during the first quarter has led the Canadian Real Estate Association (CREA) to revise its annual forecast for the Canadian resale housing market.
The CREA said Wednesday it now expects about 490,600 units across Canada to be sold this year through its Multiple Listing Service, down from the 527,300 units it predicted in its previous forecast this past February.
It also expects a much smaller increase in the national average price of a home.
It had previously forecast the average price to rise 5.4% to $337,500. It now estimates prices will rise 1.6% to $325,400.
A significant revision to the forecasts in B.C. and Ontario were cited as the main reasons for the update. The association now expects 80,000 homes to be sold in B.C. this year, down from 101,900 in its forecast in February.
The CREA expects a 5.9% decline in the number of B.C. home sales this year from the 85,028 units sold in 2009. It had previously forecast a 19.8% increase in home sales from 2009 levels. The association said a decline in affordability impacted sales in the first quarter.
The average housing price in B.C. is expected to rise 2.3% to $476,400, down from the previous forecast of 4.2% to $485,500.
It also significantly dropped its forecast for Alberta home sales to 55,900 units from 63,050 units due to softer sales in the first three months of 2010.
Not all forecasts were revised downward. The CREA expects better sales in Saskatchewan, New Brunswick, PEI, Newfoundland and Quebec.