The Royal Bank of Canada predicts a 16% plunge in sales of the Alberta’s existing homes, as oil prices continue to drag the provincial economy.
The lender said on its Monday forecast that the number of homes changing hands will drop to 60,500 from 71,800 in 2014.
On 15 January, the bank predicted Alberta’s home sales would drop 6.5% - the biggest since the 21% drop in 2008.
“We’re in for some kind of a correction in the province,” senior economist Robert said. “Whether this will translate on the pricing side remains to be seen. We’ve seen in the numbers in the past few months a change in psychology in the province.”
Royal Bank also predicts prices to dip 0.5% to an average $370,600, the most since a 6.5% decline in 2009.
Since June, crude oil’s 50% drop is already affecting the province’s housing market. Calgary, its largest city, also reported a 25% drop in home sales from November to December, the biggest monthly fall since October 2008.
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