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The housing prices in Toronto have increased by 23 per cent in November compared to a year ago.

Melissa Renwick/The Globe and Mail

Greater Vancouver's housing market exited 2016 in a slump but still managed to finish with the third-highest sales year on record.

Residential sales totalled 1,714 last month, down 39.4 per cent from December, 2015, the Real Estate Board of Greater Vancouver said Wednesday.

It marks the ninth consecutive time that sales declined month over month and the sixth month in a row that they fell year over year. Last month's sales volume rang in 8.1 per cent below the 10-year average for December.

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"The market has levelled out, but we haven't seen panic selling," said Royal LePage realtor Adil Dinani, whose business focuses on Vancouver and the neighbouring communities of Burnaby and Coquitlam.

Forecasting and advisory firm Oxford Economics said Wednesday that strong annual price gains in the Vancouver region and the Greater Toronto Area "now look to be a thing of the past."

In Greater Vancouver, the composite benchmark price for various housing types dipped to $879,600 in December, a decrease of 2.2 per cent over the past six months but up 17.8 per cent from December, 2015. The industry's benchmark price depicts typical properties sold.

"Concerns about the sustainability of future price gains will likely move speculators to the sidelines," Oxford Economics said in its analysis of Greater Vancouver and the GTA. "Higher U.S. interest rates will filter through to hike mortgage rates in Canada."

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Despite the second-half slowdown in Greater Vancouver, the number of single-family detached houses, condos and townhouses changing hands during the full 12 months still managed to be the third-highest sales year on record, after 2015 and 2005.

Residential sales totalled 39,943 in 2016, a 5.6-per-cent decline from the record-setting year of 2015.

But the Fraser Valley Real Estate Board – which includes Metro Vancouver suburbs such as Surrey, Langley and White Rock – saw sales climb to 23,974 transactions in 2016, up 13.6 per cent from 2015. The price for detached houses sold in the Fraser Valley board's territory averaged $914,763 last month, up 1.2 per cent from November and 13.7 per cent from December, 2015.

Last February, the B.C. government introduced a higher tax rate on the portion of a property that sells above $2-million. In August, the province implemented a 15-per-cent tax on foreign home buyers in Metro Vancouver, which includes the sprawling suburb of Surrey and most of the Greater Vancouver board's territory.

"The market already started slowing down in March and April. I'm not a big fan of government intervention," Greater Vancouver board president Dan Morrison said in an interview. "The market has a way of taking care of itself."

The benchmark price for detached houses sold on Vancouver's west side slid to $3.44-million last month, down 2.9 per cent over the past six months but up 19.3 per cent from December, 2015.

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"Local buyers and sellers sat out of the market for several months to see how the foreign-buyer tax was going to impact them," Mr. Morrison said.

In October, the federal government tightened mortgage rules, adding a new standard for gauging whether buyers can handle an eventual increase in interest rates. Ottawa also closed tax loopholes used by some foreign investors.

Mr. Morrison said relatively low interest rates, a strong B.C. economy, the lower loonie and limited housing supply in the picturesque West Coast setting will help keep the Vancouver region's real estate sector healthy in 2017.

The price for detached houses sold in Greater Vancouver averaged $1.68-million last month, down 5 per cent since July but a 1.8-per-cent gain over December, 2015. The record high came in January, 2016, when the average price for detached properties in the region reached $1.83-million.

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