Jan 2010 21

Record Sales Spark Bubble Talk

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Record sales and prices of existing homes in Canada towards the end of 2009 has stirred further debate of a housing bubble in British Columbia.

The Canadian Real Estate Association has announced that a total of 27,722 homes changed hands in December, up 72 per cent from the same month in 2008, when activity ground almost to a halt in the wake of the global financial crisis.

Commenting on the volatility of the market, association president Dale Ripplinger said: "Sales activity in 2009 came in like a lamb and went out like a lion", adding that the national average price in December rose to $337,410, up 19 per cent year over year. For the year as a whole, the national average price climbed five per cent from 2008 to a record $320,333.

The association reiterated that the national average price was skewed due to activity in Canada's priciest markets, with B.C. topping the provincial league.

In September, average house prices in the province had risen 15 per cent in 12 months to $474,000, with Vancouver averaging out at $611,000, almost 4 per cent up on nearest rival Toronto.

The robust figures continue to show the housing sector is leading the overall domestic economy out from a long downturn. But the housing market's strength has also been at the centre of a debate over whether a bubble in the sector is forming.


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