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Homes prices, sales sag

A slowdown in some of the country's most expensive cities for housing continues to drag down the average sale price of a home in Canada, the Canadian Real Estate Association said on November 14th, 2008.

The average sale price of a home last month was $281,133, a 9.9%decline from a year ago. It's the fifth straight month that prices have fallen in the country's major markets on a a year over year basis, and each month the percentage decline has increased.

Sales also continue to decline across the country. In major markets, sales in October were down 15.1% from September. The 32,046 sales in October for the entire country were the lowest monthly level since July, 2003.

"The breadth and depth of the drop in the MLS activity suggests a major downshift in consumer psychology, " said Gregory Klump, chief economist at CREA. "That has moved many home buyers to the sidelines until economic news begins to improve."

CREA said activity was down in 75 percent of the Canadian markets it surveys, including the five most active, Toronto, Montreal, Vancouver, Calgary and Edmonton. Toronto accounted for one-third of the national decline.

"Many home buyers across Canada battened down the hatches in October as they were concerned with dire headlines about stock market volatility and a global economic downturn," said Mr. Klump.