Canwest News Service; Financial Post
Published: Wednesday, April 15, 2009 

The Canadian real estate market is still sinking, but the rate of decline is slowing, indicating that stability is at least returning, the country's real estate board said Wednesday.

The number of transactions on existing homes on a seasonally adjusted basis rose seven per cent month-to-month in March.

The number of transactions on existing homes on a seasonally adjusted basis rose seven per cent month-to-month in March to 31,135, CREA said. It was the second consecutive month of a seasonally adjusted rise after several months of declines.

Actual transactions - not adjusted to remove seasonal variance - came in at 35,225 last month, still more than 13 per cent lower than the number of deals a year ago. The good news is that the figure represents the smallest year-over- year decline in the last six months.

The average price for homes sold through the Multiple Listing Service also remains depressed, but like transaction activity, the year-over-year decline is shrinking, CREA said in a release. The average residential price was $288,641, or 7.7 per cent lower than the average national price recorded in March, 2008.

"Housing markets are starting to show signs of buyer interest because of lower prices and interest rates," said Dale Ripplinger, CREA's president.

Ripplinger said the association expects the market to show further stabilization in the current month as incentives from Ottawa begin taking hold, including increases to allowable withdrawals in the Home Buyers' Plan and the First Time Buyer Tax Credit.

The amount of new listings "remains high" but continued to come down as well, in another sign that stability is forming, CREA said.

"With sales activity increasing and new listings trending lower, the balance between supply and demand is firming up in British Columbia, Alberta, Ontario and Quebec," which represent the largest markets in the country.

New listings on MLS totalled 208,755, seasonally adjusted, in the first quarter, or 6.4 per cent lower than the final quarter of 2008.

"It will take time for ample supplies of new and existing homes to be drawn down, but demand appears to be stabilizing," said Gregory Klump, chief economist at CREA.