Home sales expected to drop in 2018

MONTREAL - Canadian home sales are expected to drop to their lowest level in three years in 2018, driven largely by a decline in Ontario, the Canadian Real Estate Association said Friday.

The association expects that 495,100 homes will be sold next year after downgrading its sales forecast for 2017 on a 9.9 per cent drop in August compared with a year ago. It expects sales will fall 2.3 per cent in 2018 following a 5.3 per cent decline this year to 506,000, or 20,000 fewer than previously forecast in June. Benjamin Reitzes of BMO Capital Markets said the August data suggests the worst may have passed for the GTA following Ontario policy changes to restrict foreign buyers, but the future is unclear.