Updated numbers from the Canadian Real Estate Association indicated that overall home sales in 2018 fell by 11.1% annually, making this the largest year-over-year drop since the height of the recession in 2008.
This also followed a 4.64% shrinkage in 2017. Earlier this month, the organization warned that the impact of B-20 will continue to reverberate this year, especially apparent in both sales activity and base prices.
CREA predicted that overall sales will fall by another 0.5% in 2019, and average home prices to crawl up by just 1.7% (up to $496,800).
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This possibly points to a trend of slowdown that could threaten long-term economic stability with a dangerous chain reaction.
Said vicious cycle might manifest because for every successful home sale, approximately $64,000 in spin-off economic activity arises, by CREA’s estimates.
Moreover, an estimated 3 transactions are already equivalent to the economic activity resulting from 1 new job.
“Spin-off activity is typically general household purchases, furniture and appliances, moving costs, renovations, and professional services (financial, legal, real estate, appraisal, etc.). Those professional services represent nearly half of the spin-off dollar value,” Better Dwelling explained in its analysis of the CREA data.