Greater Victoria's housing market continued a strong pace with the highest number of sales in 17 years for the month of October, even though some prices declined.

It was the second consecutive month that sales matched 1992 levels. October also marked the six straight month that the number of homes sold exceeded corresponding months in 2008, the Victoria Real Estate Board said yesterday.

A total of 742 properties were sold last month through the board's Multiple Listing Service -- up 135 per cent from the 316 sales in October 2008.

The average price for a single-family home dropped in October to $590,567, down from September's $619,936. The median, or midway price, also slid, to $536,000 last month from $550,000 in September.

The board's monthly report was released the same day as a Canada Mortgage and Housing Corp. forecast predicting increasing sales and average prices for Greater Victoria in 2010.

About 43 per cent of the single-family homes sold in October went for under $500,000 last month, according to the real estate board. There were 24 sales of $1 million or more.

Of October's sales, 400 were single-family houses. There were 203 condominiums and 76 townhouses sold. The total sales value for the month was $349.7 million.

The average price for a condominium in October was $322,349, down slightly from $325,106 in September. The median price was $297,000 in October, a little higher than September at $295,000.

Townhouses had an average price last month of $438,058, down from $441,966 in September. The median price slid to $409,500 from $415,000 the previous month.

Total inventory declined in October to 3,219 units, down by 200 properties from the month before.

Meanwhile, Canada Mortgage and Housing Corp. is predicting housing sales and prices in the region will move up as the economy continues to improve. "Housing starts will bounce up in 2010, following two years of reduced levels of residential construction activity," the federal agency said.

There will be 1,350 new homes started in the region, up from an expected 945 this year, but significantly lower than the 1,905 built in 2008. Next year's predicted starts are based on a conservative estimate, said Canada Mortgage and Housing Corp. analyst Travis Archibald.

The 2010 forecast assumes that a number of planned multi-family developments will not break ground until 2011. However, if full-time employment and consumer spending and confidence all pick up, housing demand could rise and lead to builders breaking ground earlier, Archibald said.

Casey Edge, executive director of Victoria office of the Canadian Association of Homebuilders, is taking a cautious approach to 2010, saying, "there are a number of variables which represent unknowns in terms of the impact on the market."

Homebuilders will be watching interest rates and job statistics as well as the impact of the harmonized sales tax in July, Edge said. "What's going to take place as of July 1 is hard to say, other than the prediction is there will be less demand."

When the goods and services tax was imposed, builders went through a "significant slow-down," Edge said. "They have been through this before."

Canada Mortgage and Housing Corp. predicts the total housing sales for the region will climb to 7,450 in 2010, up from 7,300 anticipated this year and higher still than 2008 with 6,171 sales.

The average price of all types of housing -- that's single-family, condos and townhomes -- is expected to move up to $487,000 next year. This year's average is predicted to come in at $474,000, lower than the $484,898 seen in 2008, the report said. "We expect price to remain relatively flat," Archibald said.

Housing demand will be fuelled by low mortgage rates, newcomers to the region, and employment growth, the federal agency said.

Meanwhile, the Vancouver Island Real Estate Board -- covering the areas north of the Malahat -- said there were 454 single-family homes sold during October. The average price was $332,898, down four per cent from the average of the first nine months of the year.

cjwilson@tc.canwest.com