UPDATE 2-Canadian home sales fall again, seller 'sense of panic'

Tue Feb 17, 2015 4:20pm EST
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(Adds comment from Calgary realtor)

By Andrea Hopkins and Nia Williams

TORONTO/CALGARY Feb 17 (Reuters) - Sales of existing homes in Canada slipped further in January as the drop in oil prices hurt homebuyer demand in western Canada, the Canadian Real Estate Association (CREA) said on Tuesday, with one analyst saying seller panic has set in.

The industry group for Canadian real estate agents said sales activity was down 3.1 percent last month from December, the third consecutive monthly decline.

The data suggested Canada's prolonged housing boom may be ending after more than five years of rising sales that pushed home prices to record highs.

Canada escaped the U.S. housing crash due largely to more prudent lending standards, but the long boom and high consumer debt levels have raised fears of a U.S.-style collapse.

Prices, which lag sales, remained 5.2 percent higher than a year earlier, according to CREA's home price index, but fell compared to a month earlier in several markets, including the Western Canadian cities of Calgary, Regina, and Saskatoon.

A sharp, sustained drop in oil prices has sideswiped the economy in the resource-rich provinces of Alberta and Saskatchewan, where homeowners are trying to sell houses before values decline further.

"What is interesting to note about the housing measures is that there is a clear sense of panic," Mazen Issa, senior Canada macro strategist at TD Securities, said in a research note.   Continued...