Sales in the first quarter of 2008 were down 15 per cent compared to 2007 due in part to some very severe weather conditions but also due to weaker inventory for existing homes and concerns related to the overall volatility in the economy.  Last year saw record levels of sales volumes in Halifax, but listings did not keep pace.  The result has been a reduced and weakened inventory over the first quarter of 2008.  This tightened inventory situation is now beginning to balance itself as new listings began to pick up late in the first quarter.  This will allow for some additional choice for potential buyers.

At the time of writing, seasonally adjusted active MLS® listings of single family homes reached a 15 month high of approximately 3500.  Based on forecasted sales, there currently is an average of 6.5 months of existing home inventory.  This compares to about five months throughout 2007.

The average selling price of an existing home will continue to grown faster than inflation increasing by approximately four per cent per year in both 2008 and 2009.  The average price in 2007 was just under $216,000.  Prices will grow to approximately $225,000 in 2008 and $233,000 in 2009.  Some elevated inventory levels will ease some of the pressure on prices as the forecasted growth is well below the seven to eight per cent annual growth seen over the better part of the past decade.

The existing homes market has been benefiting from reduced competition fromt he new homes market.  The average price for an existing home will remain approximately 30 per cent below the average price for a new home.  However, if inventory levels weaken, buyers may be unable to find a suitable existing home and instead have to look at new construction.

To read entire article go to www.chmc.ca - order desk. Look for "Housing Market Outlook-Halifax CMA. Date Released:  Spring 2008."