WRAPUP 1-Canada home resale prices fall, but confidence up

* Canada home resale price index falls in September

* Consumer confidence rises 3.9 points in November

By Ka Yan Ng

TORONTO, Nov 24 (BestGrowthStock) – Canadian home resale prices
ended a 16-month run of increases in September but consumer
confidence perked up for a second straight month in November,
data showed on Wednesday, suggesting moderating conditions in
Canada’s economic recovery.

Home resale prices slid 1.1 percent in September from the
month before as all six metropolitan markets surveyed for the
Teranet-National Bank Composite House Price Index reported
declines for the first time since February of last year.

However, prices were up 7.9 percent from a year earlier and
in line with recent housing data that suggests a soft landing
for the once red-hot sector. [ID:nN15250947]

“September’s drop notwithstanding, we do not think that a
significant price correction looms in housing,” said Marc
Pinsonneault, a senior economist at National Bank Financial,
pointing to balanced market conditions as reflected in recent
new-listings-to-sales ratios.

Pinsonneault said that a U.S.-style wave of home
foreclosures was unlikely because Canadian lenders have been
far more conservative about mortgage loans than their U.S.
counterparts were.

That sentiment was echoed by Finance Minister Jim Flaherty,
who said this week he sees no sign of a housing bubble in

“I think moderation in the real estate market is a good
thing. That’s why we tightened up some of the rules this year
on high ratio mortgages,” Flaherty told reporters in Ottawa on


Other figures on Wednesday showed consumer confidence rose
for a second straight month in November, suggesting a more
hopeful outlook on finances and job creation, the Conference
Board of Canada said.

The board’s consumer confidence index rose 3.9 points to
83.6, “sufficient” to erase declines recorded between July and
September, it said.

Confidence levels are still not as high as they were early
in 2010, however.

Other recent data have also indicated that consumer
spending is slowly returning to health and Statistics Canada
said on Tuesday that retail sales rose for a fourth consecutive
month in September. [ID:nN23105406]

The proportion of respondents in the consumer confidence
survey who expected their financial situation to improve over
the next six months climbed 1.8 percentage points to 24.7
percent in the consumer sentiment index. The share of negative
responses fell to 13.2 percent, the lowest level since March,
which the board said was encouraging.

The board said responses to a question on the current state
of personal finances were largely unchanged, while the balance
of opinion towards future employment shifted to positive for
the first time since July.

The survey of consumer confidence was conducted between
Nov. 4 and Nov. 14, and the margin of error is plus or minus
2.2 percent.
(Additional reporting by David Ljunggren in Ottawa; editing by
Peter Galloway)

WRAPUP 1-Canada home resale prices fall, but confidence up