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Canada's housing market both vigorous and stable " _" n( k. |8 @2 B3 k& h0 L
: s; D: c+ L! Z; Y
- Country's market poised to show growth throughout 2006 -, m7 A. W1 E ~" z# o
. O9 q" e/ K, J8 L5 f TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
, u/ y' ] Z( h Oexhibited moderate price increases and stable unit sales during the third& a8 S8 ~; l' w( y+ } ~& U3 Z* x
quarter. Wide regional variances continued to be the dominant characteristic: ~' n1 E6 e9 x. v$ J. \
in the market, exemplified by frenzied levels of activity and double digit
+ N) h8 ~4 t0 t1 Fprice gains observed in the energy and commodity rich Western provinces, and! D% {* t* u3 p2 y4 T% B
more reasonable sales volumes and moderate price appreciation in Ontario,
' D2 Z" r" y' @0 S# Q$ T; Z) R( AQuebec and Atlantic Canada, according to a report released today by Royal
& N$ g! d E# P% NLePage Real Estate Services.
; F+ W/ ]; Y2 c% q, g. v
: n1 I' z4 u( {5 m. C Nationally, market trends established through the first three quarters
! a# q0 a' o- Z! Mare forecast to continue for the remainder of the year. Robust economic
+ _4 _- Q( K h; X( Econditions, low unemployment rates, modestly growing salaries and wages, and
+ k2 @1 e% |( E9 j. x1 H: e4 T# @9 wsound consumer confidence contributed to the overall strength of the
: M" I# E0 I- N- R* b) ^residential real estate sector.; f% e, J5 y% s! m
% x; p2 h8 k' L/ `! b* U. q3 _ Of the housing types surveyed, the highest average price appreciation: z% I! [; h- z- o; Z4 u( A, X* U3 r
occurred in detached bungalows, which rose to $300,365 (+16.3%), [2 R) P c! C3 m: \
year-over-year, followed by standard condominiums, which rose to $211,562# [/ ?# C; M8 P- Q
(+14.2%), and standard two-storey properties, which increased to $365,380
) m8 m2 \" e0 N1 k ]! |; I(+13.2%).* ^6 o4 u X3 ?% `/ c- y' T5 c
& i* J6 O1 B7 u0 j
"Canada's sturdy housing market continued to demonstrate steady growth `+ H; i, o2 R3 Q# Y
during the third quarter. For all but the west, we have moved on from the
, _6 F8 ? \" _0 @4 Dfrenzied expansion that characterized the first half of this decade, and are
4 R* l& b) b7 S4 {4 W: x8 Rpoised to show continued growth at a more moderate pace," said Phil Soper,/ g7 D# Y5 E9 E( f. @
president and chief executive officer, Royal LePage Real Estate Services.
/ O1 z" B. C! D7 ~/ q% Z- H"Gone is the sellers' market that we have lived with for some years. We
" r9 m! L( ^6 e% e, j& N3 Bwelcome the more reliable conditions that are characteristic of a healthy! ^& ~" q0 }9 u( A6 K
balanced market."
% ~% w, f( o( M4 |% f
% S4 \$ `& u- L$ o, G' D O Despite the double-digit rise in average national house prices,
( y4 q2 b" e' q# Fconsiderable regional variances were exhibited again this quarter. The shift
1 j. n# }, J# U# Wto balanced market conditions, which began in late 2005, has continued* r/ _2 } S& o! B( H, [
throughout most of the Central and Eastern regions of the country. In the core* e- D- j7 ^3 |9 [6 _0 `
energy producing western provinces, the combination of very high in-migration,9 p- k8 d2 b, C- O. y/ c
manageable affordability, and a shortage of inventory has driven record( L3 B9 I0 X: u) ~) f* \/ l: F0 ~3 J
breaking price appreciations.
! O9 u' U( z' i) y8 ~$ S& a4 s# S+ Z
, i: }4 v! I+ p7 w2 Y Echoing the second quarter and supported by Alberta's rapidly expanding
+ H$ N5 V$ w, a2 Heconomy, Calgary and Edmonton led the charge of Canadian cities with the- M! `' k! _/ B
largest house price appreciation in all housing types surveyed.
) K, p$ G3 o9 x( U. \7 A3 q7 Z9 o! w* e- b3 f R. u* A
In Ottawa and Toronto, growth remained steady, supported by solid
4 c3 J9 X h: Y& }$ u1 b) [/ D" jeconomic fundamentals, an increase in available inventory and strong consumer t- F4 B. G' ^
confidence. While the pace of price appreciation in Ontario leveled off( w: O; N( X7 |
slightly, the province's real estate market remains poised for modest growth.
G+ L+ n1 ^( h/ v! aIn Atlantic Canada, new housing and condominium construction offered buyers
+ x2 o# _( ]* b" a h; M# N5 N+ Ogreater selection at more competitive prices, resulting in a slower rate of4 h1 U$ k, ~8 n, ?; P) S) Z& j
price appreciation when compared with 2005.
' c. |) k1 _: I& P( [& c. f! Z7 j e J7 o
While the pace of growth in Canada has slowed, the domestic housing- r) C- \& A' M
market is expected to outperform the American market. The economic and
5 o- S8 l/ i$ w+ C& O6 e: o& ]financial fundamentals driving the residential real estate sector in Canada
5 V8 Z( i; }+ V. e4 C/ K" x0 `are markedly different than those found in the United States.
" @0 E6 E8 P- m: y, l# h `" d, _; @1 P4 p( p2 Z
Added Soper: "Canada's housing market is likely to outperform the
1 U k( R) ]. RAmerican market through 2007. A number of factors are working in Canada's
8 Q3 w8 e: h$ M. b8 {, \favour, including healthy personal and governmental debt levels, the
6 ? \( D8 V9 p* I, U L* ^; qrelatively modest rise in interest rates in our country, and general
- i n/ _! F+ J! f: u# v4 l. |affordability in our major cities. In addition, Americans are now seeing the6 a8 [/ K) M1 p8 s* }2 g# y
downside of a tax system that encourages maximum homeowner leverage, and
+ \" n5 _- b9 r8 v# [aggressive financial products such as zero- and negative-amortization6 L" u- Q) Q; A& f: Q; o
mortgages that work only in a high price growth environment."
+ D# p8 w( t7 ]1 ~$ S
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REGIONAL SUMMARIES
: `" v& Q% ?" t/ R5 {2 Z2 h >>' \6 q4 u# S6 E: |$ W% ^
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Balanced conditions continued to characterize the housing market in
4 a# Z: R* J# G, yHalifax, as significantly higher inventory levels helped to moderate the rate4 u+ Y @% T) r/ D) U2 l
of price appreciation. Buyers were increasingly choosy, taking more time
5 c* x# J4 [' k, V" c% O$ llooking for newer, low-maintenance properties that were not in need of" H3 M1 u: ]% I" I- D
renovations.
4 f. e. |" v, A* p, V2 ?5 H* d
# z: ]' m( z8 m. H2 M The housing market in Moncton remained healthy and strong as a slight7 {% O2 d: P; g5 P7 `0 _/ K
increase in inventory helped to moderate the rate of price appreciation! c( ~7 f, ], z& }8 e
compared to the same period in 2005. Activity was brisk throughout August and
# h+ m- C8 s' A$ d8 ?7 z; DSeptember and is expected to remain this way through the fourth quarter.2 B% S# c" p; `3 \# n- `2 W& V
7 f `3 k; h- Q5 ]: @
The housing market in Saint John underwent its traditional summer' B' V' Z+ i5 }/ X
slowdown in the third quarter, with activity picking up towards the end of the, n" L/ ~- O! _; @* N
quarter. The local economy continued to thrive, as construction on a new, G0 y& N T$ Y0 _# `# s& S
600,000 square-foot shopping area has begun, bringing several new box stores( U! n5 L: O# ^
to the area. Buyers have begun seeking less expensive fixtures for their homes
8 M) X) a4 f" ~1 M4 ]+ P/ Kand are instead opting for more affordable housing options.6 B) X7 d- u0 N# u
8 s" M3 ]5 u3 [ In Charlottetown, the housing market started to move towards balanced
! A- b# ]/ p6 J0 j" |conditions, as some sellers had to begin to lower the asking prices on their
% {, D q4 S0 I# T' V* Thomes to make them more competitive. Activity from out-of-town and US buyers* ]; _" f5 Z% |2 O3 w: m
was down slightly compared to 2005, likely attributable to the strong Canadian
7 n6 @$ s# j) ?* Q0 Ydollar. Inventory levels began to creep up in the third quarter, providing, ^9 @* v4 v. \2 q; `% D
buyers with more options when looking for a home.) D+ ?% z; l# t, B8 n0 L
- W" T5 g3 e3 M0 y
Activity in St. John's slowed slightly in the third quarter, particularly% [' P/ j1 }: U- D9 n
among higher-priced properties, where there was a slight over-supply of homes
" ~* U- A7 s. N; N2 i6 l4 Bpriced over $200,000. Listing periods have increased when compared with 2005,
. T6 V; |& M/ U( h ~/ f; Oas some of the pent-up demand that had characterized the market over the last- \ h" \6 _9 {) ]/ u) d
few years has been satisfied, resulting in more normal, balanced conditions.
4 k) `" L2 o$ f; w! ]
! _5 x) s7 x' F6 b Montreal's housing market recorded modest increases in average house
# Y# G2 U& Y" ` ~prices, due to a slight seasonal slowdown in the third quarter as inventory
3 m$ ~+ t0 `; l4 Tlevels rose. Part of this can be attributed to the fact that many renting
7 B# l- j) f+ f L3 Ifirst-time buyers were motivated to close on the purchase of a home by July 1,
5 j0 s# u0 L& _: t; o* qwhen rental leases expire in Quebec. Once this date has passed some of the
* g, o5 y7 l3 x: A8 h; rpressure is taken off the market, allowing buyers to visit more homes before
" t9 j* l4 e0 h" Y' vmaking a purchase.' c" b4 P" N8 z# Z3 C y
0 V: L6 G x5 Q
Ottawa held its position as one of the country's most stable housing4 l) O* |- Y- |% N$ A3 x0 {
markets in the third quarter, reinforced by a vibrant local economy and strong1 s5 e- \/ C; [, D) |
confidence, resulting in modest increases in average house prices. The city: w7 ^! A( C' s7 E- s* _
centre remained a bright spot in Ottawa, with homes in this area attracting3 d# d4 e3 e$ w( [; G& X7 x0 d
attention due to their convenient location and proximity to downtown$ X; V* b1 _& y) `# U
amenities.# m4 i% F; Q2 k, `
: M; z! u! b8 b
The housing market in Toronto sustained healthy activity levels
1 L P. p7 x% O# P' _3 Athroughout the third quarter, as a strong economy helped to maintain demand
& J/ a, h6 u# |0 l; hacross the city, causing average house prices to rise moderately. Toronto has
: q. f+ Y# S& s1 H8 c2 Icontinued to experience modest growth in average house prices, and has been& c& `+ N/ X) ], F! P ~8 _) a) f% J
driven primarily by purchasers who are buying homes as their principle# k2 X9 n% @$ r$ H" A
residence, rather than for investment.
* N' |, ~- h. K3 c6 t
& [. W" C O2 e$ d0 O( S+ | The vibrant Winnipeg housing market continued to show its strength as
0 u9 m8 G6 `& [7 k/ f0 Y8 t {. Ehouse prices rose during the third quarter. The booming local economy resulted
$ v- ^$ |# z9 C# t0 {- E8 xin a historically low unemployment rate, helping to bolster consumer. W8 v4 r( }+ g* Q2 D+ m3 w
confidence and Winnipeg's ranking as the city with the lowest capitalization- f2 R* y5 ~( d7 _, a. |
rate among the country's larger cities - helped to encourage buyers to enter
9 W# P' e/ l1 B8 I" @8 Q- Nthe market.9 R. J% R# |, ]1 s2 s
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In Regina, the market experienced a slight seasonal slowdown through! G- _4 `9 A! k6 Y6 P8 ~
July, as there were fewer purchasers in the market due to summer vacations. In; ]8 k. N6 k( |; g
August, activity resumed to the busy pace previously seen in the spring5 q) C$ M) S, g/ v
months, as the influx of purchasers made it more difficult to find a home due1 P8 V; _/ R. T3 H- a
to the shortage of available inventory.
* H0 C2 i4 J! @1 l. _0 c! \; }8 W6 c6 U
2 m/ l2 Z' `4 X5 B' x, ~ Activity in Saskatoon remained brisk as the market maintained its# g1 A+ q6 f' M$ Q6 N, R
momentum from the busy spring sales period. The economy in Saskatoon remains5 e: ~" ]# y% |; @
vibrant, as employment opportunities are abundant with many businesses
6 f7 M( O2 Z: x3 h4 F1 p" \struggling to make hires and having to recruit outside the province.1 ~/ M" W2 @0 x
, }# V8 B8 ]- y; X
Calgary's housing market recorded blazing average house price increases9 V9 l# c/ | h; {) I3 X
in the third quarter, in all surveyed categories. The burgeoning economy, low; H' _/ V# X j/ u$ L
unemployment rates and low inventory levels remained the leading factors that
" G2 t' E8 J; t1 a+ g; T6 Kpressured Calgary's house prices upwards. However, regardless of the soaring: W2 R( W; H0 Y9 V
prices that characterized the market - even during the typically slower summer9 ? [9 O, W. D) ~
season - it is expected that activity will become slightly more balanced, as
7 O* `% b( Y* \: Cbuyers are becoming more reluctant to participate in the frenetic activity.
% o/ X# K' Z6 c1 A6 K& j: {3 w6 h; P7 M8 A! L. B1 H/ V! v
Edmonton's booming local economy continued to thrive in the third quarter
: A- h4 L" w( L. h: n( R# fas activity in the oil sands north of the city continued to flourish. Edmonton f0 _/ T1 }5 ]+ h2 [* s
remained the hub of activity for those coming to work in the oil industry,* k, b, Z' y) h2 J: P
maintaining tight inventory levels across the city, resulting in prices! Y6 ?' o% \9 f1 @. {6 F' g% j5 @
increasing at record levels. However, as inventory levels continued to improve- w) F* W I6 B: x( C1 H" O/ Q( F& {
in the third quarter the rate of price appreciation should moderate slightly) H# e; g( M+ z( b( s4 D% G \0 b
towards the end of 2006. 1 B( T7 B! L7 m0 S- e
5 a8 @9 Z; \; x# b+ i2 b) D7 FWhile Vancouver has seen a slight reprieve from the severe shortage of8 W L7 D8 b& }6 J( v% w
inventory that had previously characterized the market, supply is still unable0 o# u; x" T1 L/ d( k
to meet demand, driving house prices upwards. Vancouver has a very diverse
+ P) F# ^2 d6 ]* ggroup of active buyers - from first-time home buyers to baby-boomers to
3 }* r+ m4 |. N; cforeign investors - all of whom fuel the demand for houses, placing added
& w8 o* }- B% G1 [' rpressure on tight inventory levels.
9 r6 N/ l# S, F# X: t. c: k. r8 l4 s$ \2 n" z$ K
Victoria's market is vibrant and supported by strong economic# j: }# p, k0 ?3 C
fundamentals, fuelled by a booming tech sector and a migration of young people
: T1 I' K& J; ?! k+ V4 K1 Winto the city that has continued to support the area's house price increases;6 g2 t1 V( c C7 g& t5 U
while increased inventory levels have afforded buyers more time when searching/ N& z: s1 B4 R7 G* e* X
for a home, helping to normalize the market's pace.- O' I1 T8 Z6 h8 K' z2 c
- C2 x) ?& E( l0 G: A: v: ^7 t) l
<<( \3 \. h3 M& _ d, Y* M
Survey of Canadian Average House Prices in the Third Quarter 2006
% j a3 l& k- _: M$ a8 n! t7 |, j* b( m# e
-------------------------------------------------------------------------
1 v- V" p# z5 n& d5 L' v' c Detached Bungalows Standard Two Storey+ u0 H6 E9 k, w$ a% Y. t
-------------------------------------------------------------------------
9 k$ l6 Y( K! X; O 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
" k. \, X' A+ ?6 \* ^; B Market Average Average % Change Average Average5 p# l$ a4 i4 Y3 `! n D# n. }% v- v- p
-------------------------------------------------------------------------: S5 E% P7 I2 I7 q: m
Halifax 186,333 173,333 7.5% 198,667 199,000
, D' R. @% ]) i+ W -------------------------------------------------------------------------0 ^- v9 Y/ E. v; v4 _* U: g" t, H
Charlottetown 145,000 141,000 2.8% 175,000 170,000& m( l- [$ U9 Y9 l- }
-------------------------------------------------------------------------
5 g. f% L8 p- Q+ D, @0 } Moncton 135,000 127,000 6.3% 129,000 123,0008 P6 ?) [0 @ G( K4 P) A- Z
-------------------------------------------------------------------------0 O: b8 E9 Y; t$ r# v6 ~) [) [
Saint John 141,200 142,900 -1.2% - -; F7 t/ r4 V: [, e( j
-------------------------------------------------------------------------
& p+ Z2 R$ u! I# {! G. j9 Q) v St. John's 143,667 142,667 0.7% 200,667 202,333
6 t d4 @) g; [ -------------------------------------------------------------------------; R p" [+ G' ?$ D% ?) p( A
Atlantic 150,240 145,380 3.3% 175,833 173,583" m" a; ]: H* E' g8 w( L
-------------------------------------------------------------------------7 N6 D: z( Z w- z9 O
Montreal 213,691 203,500 5.0% 321,141 316,185
9 ~& d; B) l# O3 c$ H- e -------------------------------------------------------------------------- |9 r+ W& [/ A& `2 D
Ottawa 290,083 278,417 4.2% 285,667 273,250
" N7 o7 _% w5 c -------------------------------------------------------------------------
8 P0 }' h1 H, S Toronto 373,368 355,882 4.9% 481,523 474,766# ]3 X8 S. v+ Z+ V2 T
-------------------------------------------------------------------------3 n& r; a6 o# ]% ]
Winnipeg 181,579 159,860 13.6% 202,337 180,707" V9 E% _7 ~1 } c. e3 [
-------------------------------------------------------------------------$ }/ f# d( y' f4 \( M$ C1 @
Saskatchewan 170,667 156,083 9.3% 182,600 166,500/ Z- t$ f0 C0 t" D. C* N/ b$ ^
-------------------------------------------------------------------------
0 Z" R+ l+ L" M; ^0 X) P& Q! E$ U Calgary 395,067 252,411 56.5% 405,778 264,389, A# X2 M5 b6 Z8 Q4 X( f
-------------------------------------------------------------------------* a, m. _! L2 D/ W4 q& p7 ~$ s
Edmonton 286,857 194,857 47.2% 316,429 206,714
6 O/ c& V" V5 [) x# i" O -------------------------------------------------------------------------; R6 L# \7 E3 L* i/ \! O
Vancouver 704,250 601,000 17.2% 794,000 697,500
- p, o' [5 a. C4 P0 g8 c" P) U -------------------------------------------------------------------------) E$ k: K1 i) ^2 \) z/ I* r8 T# O0 c
Victoria 375,000 348,000 7.8% 403,000 391,000; e; x0 h# `1 r/ D* |
-------------------------------------------------------------------------
+ t: ^1 _. F, B* n National 300,365 258,202 16.3% 365,380 322,860
( C/ Q. P/ Q, D5 ~& L d -------------------------------------------------------------------------
+ D( n/ [2 y" L9 P2 S% ~. o+ F3 | S0 m
-------------------------------------------------------------
* P$ G" [0 n2 s! Q* E Standard Condominium; g5 s0 {) R+ {& Y1 S" P6 ]1 c. p
-------------------------------------------------------------
, K9 G( w# Q7 e: g, w% f 2-Storey 2006 Q3 2005 Q3 Condo: Z+ L$ N9 }9 B5 w( _
Market % Change Average Average % Change
( I& o. D7 a; O0 d. Y; A -------------------------------------------------------------. Z/ ?, C% i( [- Q! I4 }: ^6 a' M
Halifax -0.2% 142,000 103,000 37.9%% `/ C5 A: m( o E; ^' r
-------------------------------------------------------------
: v2 D" ?! n- m v Charlottetown 2.9% 98,000 98,000 0.0%* [2 }6 y5 h5 {( u
-------------------------------------------------------------: _5 N7 B) ]) d) k8 t; e
Moncton 4.9% - - N/A
+ O! U8 z( [6 c5 Z3 f: u -------------------------------------------------------------
3 P) _+ _( \2 Z9 I) O! Z% N Saint John N/A - - N/A
" U5 T1 A% R, C$ d3 L! v -------------------------------------------------------------# @4 h2 e6 \, ?9 m0 N7 ?: x, Z1 O0 O1 T
St. John's -0.8% 146,333 145,667 0.5%
$ L( K5 G' R1 I -------------------------------------------------------------
/ T4 N' E3 X& h; F- B$ r/ b5 z3 ? Atlantic 1.3% 128,778 115,556 11.4%
4 O; z9 D4 k' W% R -------------------------------------------------------------; c9 o1 `4 i. D2 Y
Montreal 1.6% 193,190 188,016 2.8%
" d0 @& F. v7 h0 ?# s -------------------------------------------------------------4 J/ t( r. f7 z3 Z( u
Ottawa 4.5% 181,083 172,250 5.1%* a" m+ c v& ]+ _
-------------------------------------------------------------; h9 @* C- E$ R* t7 f, G8 C0 |1 u+ l
Toronto 1.4% 252,088 242,918 3.8%
* D/ s) P9 u4 g: _ -------------------------------------------------------------# K" C$ S, f/ T
Winnipeg 12.0% 105,648 96,008 10.0%! @( m. R/ R2 R7 h& o; n: j. S
-------------------------------------------------------------/ A; [3 k7 ]5 W* N ~! d8 M
Saskatchewan 9.7% 106,250 101,000 5.2%* V8 `5 t1 {( ^" g( f3 t2 K
-------------------------------------------------------------
- q7 {7 O8 J4 n: q- V" C Calgary 53.5% 245,844 153,867 59.8%
7 K8 o2 e* {$ F -------------------------------------------------------------# G3 b0 L- m2 D) y0 L- {
Edmonton 53.1% 200,433 131,500 52.4%
6 L. U6 c$ N; f* o+ T. R -------------------------------------------------------------# ^; j) t* [/ x3 I( S ~5 E' C
Vancouver 13.8% 366,250 323,250 13.3%
: K& a; V" c% s2 ~" ? f -------------------------------------------------------------1 S2 \+ n) C8 k
Victoria 3.1% 229,000 220,000 4.1%5 b1 _- H1 M; @& H, H
-------------------------------------------------------------
, u3 Q# U/ A+ c g2 X National 13.2% 211,562 185,296 14.2%
8 W. g* `0 e, B( g -------------------------------------------------------------7 |% s/ V; [* G1 s2 A# P0 f
>>0 w M' k1 ?, N& d
! A# z. ~( ?- S9 u9 W0 f7 e: M* W Average house prices are based on an average of all sub-markets examined
8 O* r/ r2 J6 Bin the area, except for the smaller markets of Charlottetown, Moncton, Saint& v& B; _/ O, j2 ]( e( n* \* H
John and Victoria.' Q9 P, K- a1 I% G: f8 I
; }1 f9 l! Y( g$ A& A
The Royal LePage Survey of Canadian House Prices is the largest, most
) M7 z8 ^6 h1 acomprehensive study of its kind in Canada, with information on seven types of
2 N. I7 L7 e4 t& ?9 Chousing in over 250 neighbourhoods from coast to coast. This release
$ G! a7 Y/ K, ereferences an abbreviated version of the survey, which highlights house price( _# @4 X; p& z. p/ p
trends for the three most common types of housing in Canada in 80 communities
1 t/ l7 N0 {0 S [ bacross the country. A complete database of past and present surveys is. ^3 t" \ X/ `3 r
available on the Royal LePage Web site at www.royallepage.ca, and current
! `: x( T( ?7 n" Gfigures will be updated following the end of the third quarter. A printable4 c1 b" a! I4 w: ^; E8 e. V" P
version of the third quarter 2006 survey will be available online on
- h; R$ s# f+ v5 n9 M/ H3 DNovember 15, 2006.
I6 V" c% `/ F4 X Housing values in the Royal LePage Survey are Royal LePage opinions of
/ T! [" s @4 e6 ofair market value in each location, based on local data and market knowledge6 }- P4 z0 ^- l
provided by Royal LePage residential real estate experts. Historical data is
% U2 v0 n& y1 c/ a" bavailable for some areas back to the early 1970s. |
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