Scotiabank Declares End Of Canada's Housing Boom

November 20, 2008 7:25 p.m. EST

Toronto, Ontario (AHN) - A report by the Bank of Nova Scotia's senior economist and real estate specialist declared Canada's housing boom officially over. But report author Adrienne Warren clarified that while the country's housing real estate sector will soon turn into a buyers' market, it is far different from the downturn experienced in the U.S.

"This is not a U.S.-style bust caused by overbuilding, speculative buying and imprudent lending, but rather a cyclical slowdown accompanied by a valuation adjustment in several large centers where booming demand conditions and temporary supply constraints led to an overshooting in prices," Warren wrote.

The slowdown will be felt most in western cities, specifically at Calgary, Edmonton and Vancouver. But the development will be in favor of Canadians seeking to buy homes since home prices are expected to go down throughout the country.

A week ago the Canadian Real Estate Association said the national average resale price of a house decreased to $281,133 in October. It was the fifth monthly decline and the largest dip since August 1982.