New home sales slide

Ottawa's modest rebound in new home sales in April turned out to be short-lived as sales were again sluggish in May, according to figures released by the Greater Ottawa Home Builders' Association.

There were 336 new home sales in May compared to 396 sales in April. That's also down from the same period last year, which saw 378 new home sales, and below the five-and 10-year averages for the month of May of 412 and 414 new home sales respectively.

Sales have been slower this year in general. For the first five months, there were 1,619 new home sales, a drop of 22 per cent from the same period a year ago, which saw 2,094 sales.

The Canada Mortgage and Housing Corp. also reported this month that housing starts in Ottawa were down in May, bucking the national trend.

Non-seasonally adjusted totals show 266 housing starts in May, down from 446 in April. May's total was also a major drop from the 709 starts of a "very robust" May 2010, CMHC said.

"The latest activity is a reversal from the strength observed earlier this year, but does not yet constitute a change in the underlying trend," CMHC market analyst Daniel Benatuil said. The agency predicted only a modest drop in home starts in Ott awa in 2011.