UPDATE 1-Canada November existing homes sales rise -CREA

(Adds sales, price forecasts for 2015 and 2016)
By Andrea Hopkins
TORONTO, Dec 15 (Reuters) - Sales of existing homes in
Canada rose in November from October as gains in Toronto and
Vancouver once again helped offset softness in other markets, a
report from the Canadian Real Estate Association showed on
Tuesday.
The industry group for Canadian real estate agents said
sales activity was up 1.8 percent last month from October.
Actual sales for November, not seasonally adjusted, rose 10.9
percent from November 2014.
CREA's home price index rose 7.1 percent from November 2014.
The continued gains in home sales and prices in Canada's two
largest markets has renewed fears of a housing bubble, and the
federal government last week raised the minimum down payment on
more expensive houses to try to cool the market.
The resilience in Toronto and Vancouver also prompted CREA
to upwardly revise its forecast for 2015 and 2016, a move that
has become standard in a country that has defied for years
predictions that the market will cool.
But even as CREA raised sales and average price forecasts
for Ontario and British Columbia, it lowered forecasts for sales
activity in the energy heartland of Alberta and for prices in
Alberta, Saskatchewan, and Newfoundland and Labrador, due in
large part to the long slump in oil prices.
The forecast for national sales in 2015 was revised higher
based on the anticipated strength in Toronto and Vancouver.
National sales were projected to rise by 5 percent to 504,000
units in 2015, up from a 3.3 percent rise forecast in September.
Sales are expected to fall 1.1 percent to 498,600 in 2016.
In September, CREA had forecast sales to be flat at 495,000.
The forecast for national average home price growth was
revised upward to C$442,600 in 2015, representing an increase of
8.4 percent, up from a 6.2 percent increase forecast in
September. Prices were expected to rise a more moderate 1.4
percent to C$448,700 in 2016, CREA said.
With official interest rates expected to stay lower for
longer in Canada, even as the U.S. Federal Reserve begins
tightening, low borrowing costs should support sales and prices
in 2016, CREA said.
But the industry group warned that the government's changes
to down payment rules risk cooling housing markets beyond the
intended targets of Toronto and Vancouver.
"In particular, the regulatory changes are also likely to
reduce sales activity in Calgary once they take effect in early
2016," CREA said in its forecast.