Despite a slow start to the year, the Canadian market has certainly bounced back since the low of last January. Resale housing in particular is again surging forward, and in May reached new heights. According to the Canadian Real Estate Association (CREA), strengthening consumer confidence, low interest rates, and improved affordability are all drawing buyers to the housing market.

In fact, CREA reports that Canada's resale housing market activity has returned to pre-recession levels. Actual home sales via the Multiple Listing Service (MLS) of Canadian real estate boards totaled almost 50,000 units in May 2009.

The national MLS residential average sale price in May 2009 neared $320,000, and reached the highest monthly level on record. In just four short months, the national MLS residential average price recovered 16.4% from January's low.

According to CREA, the supply of new listings coming onto the MLS continued to decelerate in May, to just over 65,000 units, the lowest level since December 2005. This tightening supply will keep upward pressure on home values.

In the meantime, Canadian consumers are starting to feel positive about the real estate market again. According to statistics compiled by the Conference Board of Canada, national consumer confidence improved for the second consecutive quarter in the second quarter of 2009, and the balance of sentiment about making major purchases, such as a home, continues to improve.

Interestingly, new construction doesn't reflect the current demand. Canada Mortgage and Housing Corporation (CMHC) reports that new housing starts in 2009 have fallen sharply from the record pace of recent years. The annual rate of new residential construction was 128,400 units in May, a marked decline from over 200,000 housing starts in each of the last seven consecutive years. Housing starts are expected to improve throughout 2009 and over the next several years to gradually become more closely aligned to demographic demand, which is currently estimated at about 175,000 units per year. In the meantime, there will be less inventory for home buyers to choose from.

So, what's the bottom line? Increased affordability due to historically low interest rates, government housing stimulus programs and rising consumer confidence have all contributed to the demand for homes. Meanwhile, supply is dwindling, due to a decreasing number of resale homes coming on the market, strong sales activity, and a marked decrease in new home construction. Continued demand and reducing supply will place more upward pressure on Canadian house prices.

This month has been busy...not just with real estate but also with our youngest son graduating and moving into another completely different level of freedom, responsibility and decision making.

I recall someone once telling me that wisdom does not come alone... it is accompanied by old age! It is great to have discussions with young adults as they ponder the many career opportunities and business opportunities the world offers. Life is so simple at a young age, a lot of black and white and many youngsters have not seen how the world was painted with a backwash of grey, forcing us to look deep for some answers sometimes.

We had one of those discussions this week about being prepared to have children. My answer was that there will never be a perfect time to have children. It is a decision that sometimes you need to make despite the facts. You might have heard that a perfectionist never gets anything started and having children is very much the same as is buying your first house. That uncomfortable feeling in the pit of your stomach sometimes does not leave you too easily, but over time, you realise that the responsibility of bringing a child into this world is very rewarding and what may appear to be a burden of buying your first home will turn into a joy for most people who handle the responsibility carefully, with maturity.

It must be confusing to be a young adult at the moment, peering into a world that apparently is very foggy. How do they make decisions? What is the career path they should take? Not all of the answers are practical or based on fact, otherwise we would all be driving smart cars or riding mountain bikes to work, yet we don't.

Many decisions are made with an element of several key influences and real estate is no different. It may not seem to be the best time factually, for sure we will have more unemployment in BC, more people will fall into financial hardship, but that is not all because of external influences. We are where we are at in life because of the decisions we have made... period. We have no one to blame but ourselves for the situation we are in, good, bad or indifferent. Most people are now coming to that realisation and figuring (as we said many months ago) that the world is still rotating.

HAVE PRICES ROLLED BACKWARDS?

Not as much as you may be being told. In fact recently, a chart produced by the local real estate board showed that most median prices had rolled back to a 2007 level. That can't be... all the talk in the real estate forums is of us having reached 30% discounts already and more to come. Well if truth were told, we are seeing lower valued properties purchased that are lowering the median value. Recently a condo in the Verve sold for $140,000. Sounds cheap? It was good value, because you do not have much selection at that level, yet, it represents a sale value of $428 per square foot...on par with the last few years and more! What are we to believe? Have values gone down or is there a different motivation in the market at the moment?

We are certainly seeing plenty of activity in the sub $400,000 area and I am hearing every week of buyers who were too patient and missed their opportunity to buy that just right home, however, we will be here for a little while longer as some of the excess inventory is absorbed.

Here is the good news. Calgary and Edmonton and Vancouver are all returning to a more balanced real estate market with absorption rates higher, listings lower and buyers and sellers agreeing on values. As we see more and more people deciding to make retirement decisions and choose the Okanagan as the location we will once again see similar patterns here.

One large influence in the market I believe will be the 60-something-year-old oil and gas exec/entrepreneur who having lived through a very challenging couple of years, may well make the decision that it is time for the young bucks to see the company through the next few years and opt for early retirement and a higher quality of life.

Coupled with this trend will be the interest from foreign markets as they look at the strength of Canada's banks, stability of the real estate markets and the careful management of an economy that has fared well domestically.

We still have the opportunity to see a bright year for 2009 and that is where I will hedge my bets.

In today's challenging real estate market, people are full of questions about the real estate market. As your local REALTOR will tell you, one of the first questions most consumers ask is, "What's selling these days?"

If you're thinking of selling, you'll be pleased to know that homes are selling when they're well-prepared for sale and priced right. The reason is because people buy and sell homes for lifestyle reasons. Births, marriages, new jobs, retirement and other demographic factors all drive the market, even in times of economic downturn. However, in today's increasingly competitive market, you need the advice of a full-service professional, who knows market conditions and a home's competition and can use this critical information in readying your home for sale.

In today's market, successful sellers are those who have become more realistic in setting their asking price. They understand that a home isn't a winning lottery ticket it's a place to raise a family and build equity over time. Your local REALTOR can give you the straight facts on what comparable homes are selling for right now in your market. They can show you actual sales activity so you know what prices the market will bear. They can also talk to you about time on market, and let you see for yourself what's not moving. They can also answer the all-important question of why it's not moving.

Make no mistake, prospective buyers are out there. They're recognizing that there is tremendous value in today's market as lowered mortgage rates and adjusting prices have resulted in some of the best home affordability we've seen in many years. It's just a matter of knowing how to create a pricing and marketing strategy that will maximize your chances to attract buyers and win offers.

If you're thinking of selling, why not talk to your local real estate professional? Together, you can develop a strategy to get you a great result. Then the next time someone asks what's selling in your neighbourhood, the answer will be, your house!

No not the movie, but in reference to the forum posts that have driven so much confusion and hesitation in the past several months. As I thumbed through the forums today on Castanet, it appears that the negative hype of downward spiraling prices and sales has lost it's steam. Most of the forums are dry of new entries and off topic entries are the order of the day.

Of course if we wait long enough any trend will change. But I would encourage you to dig deep into the posts and see the wildly inaccurate projections that were often made even earlier this year.

Are we out of the woods yet? Not at all in my opinion. We are starting to turn a very long and steady corner and there are plenty of bumps in the road ahead and one minefield in my opinion that I have stated before.

The good news is that reported sales activity is up in many centres across Canada. Not across the board in terms of product type, but we are certainly seeing absorption rates that are better than they have been for several months. Personally, the activity we have seen in the past three months has been better than the previous six months and the Okanagan is seeing a better than average spring lift.

As I write this article, the TSX has just nudged through the 10,000 barrier. In fact, it has been on a steady incline for several weeks without investors continuing to test the "bottom of the market". With some good fortune, we will continue to see these positive gains in our economy. Savvy companies, like Westjet have managed the storm and returned profits on reduced volume. Many companies were not in the same position having extended themselves too far in the past couple of years and then being burdened with debt that they cannot service in this economy.

Many households are living the same experience with some downsizing starting to happen. The positive news that I can relate to is the fact that Albertans are still traveling here in good numbers. The past several weekends have been marked by many red lettered license plates on the roads, in the car parks and at real estate offices across the Okanagan. You did read that correctly... Albertans are coming here and putting offers on properties.

We are seeing the more expensive side of the market starting to move a little easier, there have been multiple offers happening on some of the good value listings and I am hearing of buyers who have missed out on a few properties because they are still taking their time to see if this truly is the bottom of the market.

Only time will tell, but the indications are very positive and we have a lot to be thankful for as a society. The road will be long, and hopefully the inclines in values will be steady and not artificial, but here is the minefield in my opinion... as I have mentioned in previous articles, our economies cannot print the money they have without the risk of artificial inflation. Right now, we are still in a Buyers market phase I believe, however, over the next year to 18 months, the economic recovery will be more evident and combined with the effect of so much extra printed money in circulation, we run the risk of seeing a period of artificial inflation that can see commodities like housing spiral again if only for a period of time before we see another correction.

Is that bad news? Not if you are in a position to invest in some of the good values today, and it means nothing at all to you if you plan to stay in the house you are in for the next ten years... what it does mean is that interest rates will likely recover quite dramatically after a period of them being artificially low prompted by government intervention.

Good news for some, bad news for others, but as in every period of time in our economy there is always an opportunity if you look close enough. I know of many people who have been buying and selling real estate successfully for the past 12 months while many "Chicken Littles" ran around saying the sky is falling. The sky did not fall, but we all personally are aware of the impact the past year has had on our personal lives.