House prices will rise, but sales expected to slide "published the May 7, 2008"

Alberta Lls sales will decline in 2008, the Canadian Real Estate Association predicts in its latest report.

Alberta will lead falloff in MLS activity in 2008.

The Canadian Real Estate Association is forecasting Alberta Mls residential sales to experience the biggest year-over-year percentage decline in 2008 compared with the rest of the country.

In a report released Tuesday, CREA said the resale market in the province will drop by 18.9 per cent to 57,900 units this year and experience a further five per cent drop in 2009 to 55,000 Mls sales.

The report says the average sale price in Alberta will rise by 4.7 per cent to $373,000 while it will only go up by 2.8 per cent in 2009 to $383,300.

Nationally, the organization says Mls sales will fall by 11.5 per cent in 2008 to 460,900 units and another four per cent in 2009 to 442,500.

The average sale price across the country is forecast by CREA to jump 5.3 per cent this year to $323,500 and another 4.2 per cent the following year to $337,000.

"MLS home sales will remain strong, despite coming in lower than last year's breakneck pace," said CREA chief economist Gregory Klump. "After -tax income growth, strong employment and short term interest rate cuts will support housing demand, despite further home price increases and increasing economic uncertainty."

For Alberta, the number of MLS sales in 2006 was 74,350 units, an increase from the 65,866 sales in 2005, said Richard Corriveau, regional econmit for the Canada Mortgage and Housing Corp.

In 2006, Alberta recorded an average MLS sale price of $285,383, which was up from the $218,266 recorded in 2005, he added.

For 2007, total sales fell to 71,430 in the province, in the province, with the average sale jumping to $356,235, said Corriveau. Overall, sales in 2007 were down 3.9per cent from the previous year while the average price increased by 24.8 per cent.

The CMHC is expected to release next week its latest forecast for the local, regional and national real estate markets.

"As soon as the buyers who are sitting on the fence restore that confidence of upward price growth, they'll get back into the market place," said Corriveau. "And that's why we think that the decline won't be as pronounced as perhaps CREA believes. Now, that said, there's still a huge number of listings in the marketplace and we're not as optimistic on price growth. We're forecasting under four per cent and that's unchanged from what we forecast three months ago. So we're not as bearish on sales, but not as positive on price growth."

But if listings do moderate into 2009, that should pave the way for stronger rate of price growth next year, he said.

Meanwhile, in a report released Tuesday by Statistics Canada, real estate agents, brokers, appraisers and related industries reported total operating revenues of $10.6 billion in 2006, an 8.1 per cent increase from the previous year, with Alberta leading the way at a whopping 37 per cent hike.

The federal agency said "Canada's real estate industry has benefited from sustained high demand for real estate that resulted in increased sales and higher real estate prices."

And no province fared better than Alberta, where the real estate market " continued to flourish in 2006" said statistic Canada. For the second straight year, the province led national growth in operating revenues for that industry.

In 2005, its annual growth rate was 20 per cent compared with the previous year.

According to Statistics Canada, in 2006, the real estate agents and brokers industry in Alberta had operating revenues of $1.22 billion, up from $0.89 billion in 2005.

In that year, real estate agents, brokers, apraisers and other related activities industries in Alberta had operating revenues of $1.40 billion, up from $1.02 billion in 2005.