OTTAWA -- Canada's housing market is close to becoming a buyer's market for the first time in over a decade, says a report by CIBC World Markets.

Its projection that house prices will likely fall another five to seven per cent came as the real-estate industry reported the number of homes put up for sale fell in August from record levels of the previous four months.

"With new listings down, the resale housing market is stabilizing in most provinces," the Canadian Real Estate Association said in its latest monthly market report, showing new listings falling 5.4 per cent in August.

Sales fell 3.8 per cent during the month as well, with declines in all provinces other than Alberta. The average selling price was down 4.6 per cent from a year earlier.

The steepest declines were in some of the priciest real-estate markets, including Victoria, Vancouver, Calgary and Toronto, which in turn pulled down the average selling price, it said.

"Slower activity in some of Canada's pricier housing markets compared to year-ago levels will continue weighing on the national average price," said chief economist Gregory Klump.

"As our analysis shows, the Canadian housing market is stable and home sellers are not under pressure to sell," he said. "This is in stark contrast to the U. S. housing market, where there are a large number of distress sales."

CIBC World Markets economist Benjamin Tal agrees.

The Canadian real-estate market did become overvalued, Tal said. However, over the past six months it has gone from being a hot seller's market to a more balanced market, he added, projecting that over the next few months it will correct further into a buyer's market, something not seen in Canada since 1995.

© The Vancouver Province 2008