Current home sales and prices expected to continue through 2012

According to a recent report from the Canadian Real Estate Association, the nation's current level of home sales and prices will continue through 2012, despite the international economic turmoil threatening the sector.

CREA released a report recently that showed the national home price fell by more than $10,000 during July, which now sits at its lowest level since January. However, the company explained home sales are still up 9.3 percent from the previous year.

With sales activity remaining strong this year – stronger than many economists had predicted – CREA adjusted its forecast for the year, predicting a 0.9 percent increase in sales in 2011 from 2010, with transactions to total 450,800 units. Prices are also expected to rise 7.2 percent from 2010, reaching an average of $363,500.

Some national analysts believe home prices will decline during the second half of 2011. However, Gary Morse, CREA's president, does not agree with their predictions, especially since interest rates with home loans remaining low.

"While there had been some talk of potential interest rate increases, that hasn't happened," Morse said. "In fact, rates have actually come down, and are now expected to remain low for the remainder of this year and into 2012. It's a great opportunity to purchase a property with financing at very favorable rates."

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