CALGARY - The speed and magnitude of the resale housing market's rebound has been unprecedented and that recovery has prompted the Canadian Real Estate Association to revise its forecast for sales and prices for the rest of this year and into 2010.

That revision is significant for Alberta.

"Alberta was among one of the most dramatic revisions in terms of unit sales," said Gregory Klump, chief economist with the association. "It largely reflects something that already happened--namely the second quarter."

The second quarter saw a combination of low interest rates and a sense among consumers the worst of the recession may be over, he said.

For Alberta, the association is now forecasting MLS residential sales to decrease by 2.5 per cent this year to 55,000 units and increase by 10.5 per cent in 2010 to 60,750 units. In its May forecast, the association predicted Alberta sales would drop by 24.7 per cent this year to 42,450 and increase by 13.3 per cent in 2010 to 48,100 units.

The association is also forecasting the average sale price this year in the province will decrease by 4.4 per cent to $337,300 and rise by 1.7 per cent next year to $343,200. In May, its forecast was for an 8.8 per cent decline this year to $321,900 and for a 1.1 per cent decrease in 2010 to $318,300.

There has been some strengthening in Alberta's resale market, said Lai Sing Louie, regional economist for Canada Mortgage and Housing Corp. in Calgary.

"We're expecting that the second half (of the year)will be much stronger than the first half," he said.

Most markets in Alberta have turned into balanced ones, added Louie. In the first quarter, they were generally buyers' markets.

Louie said low mortgage rates have been a big factor in spurring residential sales.

"Affordability has improved quite significantly," he said. "We've also seen some government incentives to encourage first-time homebuyers and that's helped. And I also believe that people who have been waiting to see how the markets move finally have the confidence now to go into the marketplace and buy."

At the national level, the real estate association is now forecasting MLS sales to hit 432,600 units this year, a decline of 0.4 per cent. This is a significant upward revision from the previously forecast decline of 14.7 per cent in its forecast issued last May.

The difference in the resale housing market now, compared with the beginning of the year, is night and day, "and nowhere is this more evident that in the West," said Dale Ripplinger, president of the association.

Nationally, MLS sales are forecast to rise 5.3 per cent to 455,400 units in 2010.

The national MLS average home price is forecast to edge up 1.5 per cent in 2009 to $309,500, as the strong rebound in sales activity, not price, in some of Canada's most expensive markets continues to skew the national, and some provincial, average prices upward, said the association.

Its previous forecast predicted a decline in the national average price of 5.2 per cent in 2009.

The national forecast average sale price is for a 2.1 per cent decline in 2010 to $315,900.

"The economic recovery is expected to be slow and protracted, so the dramatic swings in activity seen in late 2008 and this year are unlikely to be repeated in 2010," said Klump.

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Province By Province

2010 average price forecast across Canada:

British Columbia $463,000

Alberta $343,200

Ontario $315,000

Saskatchewan $239,100

Quebec $222,500

Newfoundland $216,900

Manitoba $207,500

Nova Scotia $199,200

New Brunswick $154,000

Prince Edward Is. $148,500

From Calgary Herald