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Canada's housing market both vigorous and stable
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- Country's market poised to show growth throughout 2006 -$ [: t3 P6 `9 J) w+ C
4 M1 s+ j# {' S7 X TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market, _8 k4 H- ~) |- _$ C$ b
exhibited moderate price increases and stable unit sales during the third
. B, b4 q$ ~5 i3 R% v$ l: T: jquarter. Wide regional variances continued to be the dominant characteristic: ^% z" C& f% M; K @! d2 ?
in the market, exemplified by frenzied levels of activity and double digit
! k( J, c, q2 J1 d+ ~& C$ uprice gains observed in the energy and commodity rich Western provinces, and$ X0 Y! y& W7 ^2 X8 E
more reasonable sales volumes and moderate price appreciation in Ontario,
: q" S$ E5 }" vQuebec and Atlantic Canada, according to a report released today by Royal* F, w. f& a9 }) }
LePage Real Estate Services.
( e% z' \: R7 v0 q. T5 ?# r+ Q8 d+ ~1 i
Nationally, market trends established through the first three quarters9 y+ v0 J/ U" D1 x
are forecast to continue for the remainder of the year. Robust economic; g* E9 R5 e; c& r8 E
conditions, low unemployment rates, modestly growing salaries and wages, and
; C" m+ ?7 K2 Ysound consumer confidence contributed to the overall strength of the
9 B' L; y1 S+ F& B3 oresidential real estate sector., z) H0 X; |9 [% S1 s& y( e
! I2 m+ I$ ?9 V1 }+ s
Of the housing types surveyed, the highest average price appreciation& }- W s5 t0 l
occurred in detached bungalows, which rose to $300,365 (+16.3%)% t6 `: v: _5 D/ G+ j
year-over-year, followed by standard condominiums, which rose to $211,562
) Z" n# q, D# B- @( J(+14.2%), and standard two-storey properties, which increased to $365,380( m( f& T+ V! o9 @
(+13.2%).9 ^2 f- G- _$ u" x
q' Y K& F& o- Z3 K
"Canada's sturdy housing market continued to demonstrate steady growth) R4 a9 q* x- D/ @3 D) ?, `
during the third quarter. For all but the west, we have moved on from the0 l, M7 A% u6 ~% \. P2 m0 l
frenzied expansion that characterized the first half of this decade, and are
& c+ t; @1 }* W9 |2 npoised to show continued growth at a more moderate pace," said Phil Soper,3 b& `2 _; i% p% C6 W/ \/ A
president and chief executive officer, Royal LePage Real Estate Services.4 f$ J) V% E# o( g! _! @7 V
"Gone is the sellers' market that we have lived with for some years. We
- G$ F! G, I0 owelcome the more reliable conditions that are characteristic of a healthy, X5 h+ W. N/ Z, x
balanced market."9 i' x8 @* c( ~5 h4 D& W7 q
# g( `; l' |0 H' |0 }) s6 C
Despite the double-digit rise in average national house prices," F3 \# D5 [/ {4 E7 k
considerable regional variances were exhibited again this quarter. The shift
4 I! z" k. d- M8 b1 _2 f7 i& w7 Jto balanced market conditions, which began in late 2005, has continued
) ~7 t/ C5 z# B' T; l6 ?! {throughout most of the Central and Eastern regions of the country. In the core
3 \2 H Q; N2 H9 q4 a( n, r# benergy producing western provinces, the combination of very high in-migration,
. b# i" E; j8 u$ j. \. ]# s" ?2 \manageable affordability, and a shortage of inventory has driven record; q/ ?& ?3 @; R( h) ~ d9 S
breaking price appreciations.
* _( `& h, F$ \' `* m$ U7 |( o4 w6 p: F' T
Echoing the second quarter and supported by Alberta's rapidly expanding- N/ e6 O5 q9 ?4 m7 A4 y
economy, Calgary and Edmonton led the charge of Canadian cities with the! e/ D# H( j) K; t" i" j
largest house price appreciation in all housing types surveyed.
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' ?% o/ C- y+ N6 k2 r& o6 L In Ottawa and Toronto, growth remained steady, supported by solid
; X4 C5 W: ?9 }# \& a1 oeconomic fundamentals, an increase in available inventory and strong consumer) H! ?! ~, F" r. {& l- k3 s) `( E
confidence. While the pace of price appreciation in Ontario leveled off
& ?4 Y9 q P; E3 Dslightly, the province's real estate market remains poised for modest growth.
8 \" ^- B7 s5 kIn Atlantic Canada, new housing and condominium construction offered buyers, K: j2 w' y$ z/ W+ M& u9 M
greater selection at more competitive prices, resulting in a slower rate of. ?& g* S3 t, @ O, u
price appreciation when compared with 2005.
8 h2 ^: E. o( I# N9 l& a1 t
2 n' u1 H- L0 c [" c While the pace of growth in Canada has slowed, the domestic housing+ i8 i& y @- ~, W4 D. B
market is expected to outperform the American market. The economic and; ?- G1 ~- |9 }) X1 L: e* V
financial fundamentals driving the residential real estate sector in Canada
+ K2 q; i1 C& S" i; B* F" c) Uare markedly different than those found in the United States.! B; D% D7 X: l2 S A6 F5 L
* Z1 c0 B% Y3 u9 {2 h3 L$ {9 r Added Soper: "Canada's housing market is likely to outperform the, J6 I3 x" Q, F
American market through 2007. A number of factors are working in Canada's
: V- p; ^& T1 ?2 o8 A/ [( d2 Sfavour, including healthy personal and governmental debt levels, the
+ [2 S# S* l: Trelatively modest rise in interest rates in our country, and general
, g. I! X& q3 V8 j; _0 c+ H+ T( `affordability in our major cities. In addition, Americans are now seeing the
f! w: Q; E2 R8 rdownside of a tax system that encourages maximum homeowner leverage, and
/ E9 U; a9 m/ m7 u, N" E( Paggressive financial products such as zero- and negative-amortization
' G, t7 S4 p# Tmortgages that work only in a high price growth environment."
+ U0 X" l- |+ k/ X) ?0 }
0 N1 F; R2 W3 Y/ \/ g; T; Q0 o* P <<
1 ` C' D% k- T* ?8 C2 X" L REGIONAL SUMMARIES
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Balanced conditions continued to characterize the housing market in
6 \/ L" q* j, b( @! S# NHalifax, as significantly higher inventory levels helped to moderate the rate2 e# @8 b4 H0 P2 e/ a: W, C
of price appreciation. Buyers were increasingly choosy, taking more time
% @# a: b: o5 z/ ~" i/ L5 K3 klooking for newer, low-maintenance properties that were not in need of
: P. G( r2 v4 ~$ I: |1 Crenovations.
9 L9 ]" I+ G* A" |
1 B3 S) C: y' L The housing market in Moncton remained healthy and strong as a slight
9 A) o% I* ~6 xincrease in inventory helped to moderate the rate of price appreciation
& m6 W9 e$ c$ E1 }0 hcompared to the same period in 2005. Activity was brisk throughout August and- g* [7 n& Z8 `7 N: d
September and is expected to remain this way through the fourth quarter.2 E: a- Q3 j: G1 M, N
6 H1 e! e# s" B" o The housing market in Saint John underwent its traditional summer
& ?* B" P9 p# c: t) k& yslowdown in the third quarter, with activity picking up towards the end of the6 s1 F7 [# c# H# \+ X4 }! A
quarter. The local economy continued to thrive, as construction on a new& m+ y3 w" |7 ]! @, w( c9 W+ z
600,000 square-foot shopping area has begun, bringing several new box stores
+ P6 {) Z0 f) `' Y0 |; nto the area. Buyers have begun seeking less expensive fixtures for their homes
; Y2 b/ w) O Uand are instead opting for more affordable housing options.- I: A! F& x7 p8 c. r2 U
( O, l7 A% m1 R In Charlottetown, the housing market started to move towards balanced l" ]$ m. b# K8 U0 s
conditions, as some sellers had to begin to lower the asking prices on their3 O3 u) e% P0 }5 @( j
homes to make them more competitive. Activity from out-of-town and US buyers4 q% h8 ~' k* H0 ^1 u
was down slightly compared to 2005, likely attributable to the strong Canadian
1 V) h- ?; f# X& wdollar. Inventory levels began to creep up in the third quarter, providing
, k {( `4 h% ]% Z1 ubuyers with more options when looking for a home.
8 [# o- \# r+ p% _
' J2 j- x: u) Y$ v* k( L* t i2 T Activity in St. John's slowed slightly in the third quarter, particularly# V7 C8 y3 Y6 q6 }3 O" W% I: b& `
among higher-priced properties, where there was a slight over-supply of homes
8 W/ E n7 m" @priced over $200,000. Listing periods have increased when compared with 2005,
/ g8 O0 l0 X/ d* ]as some of the pent-up demand that had characterized the market over the last) m3 M$ M+ V4 x- ^0 t7 M9 I8 j
few years has been satisfied, resulting in more normal, balanced conditions.& ~ P u7 [( o
# m/ e8 S% [8 X8 _ ` Montreal's housing market recorded modest increases in average house
6 t0 b# O% J; ]7 m' X3 [# cprices, due to a slight seasonal slowdown in the third quarter as inventory
& O) Y' A0 q/ h& v' ?% \6 zlevels rose. Part of this can be attributed to the fact that many renting) O$ v7 h; Z! \. ~, c) F; @% v
first-time buyers were motivated to close on the purchase of a home by July 1,/ N* ?' h' d# E% b- ~
when rental leases expire in Quebec. Once this date has passed some of the9 \6 }3 d/ q/ O# R8 d
pressure is taken off the market, allowing buyers to visit more homes before
1 ^0 V2 O2 l) b/ j- Tmaking a purchase. i2 u, U, d3 F( l; d; ^
# y4 o/ O: R, K: Y+ h t
Ottawa held its position as one of the country's most stable housing
/ Z# Z/ C! J$ Z+ n6 gmarkets in the third quarter, reinforced by a vibrant local economy and strong; d s5 B9 z8 P6 r1 y
confidence, resulting in modest increases in average house prices. The city
" d2 j9 N% O" V4 q, Rcentre remained a bright spot in Ottawa, with homes in this area attracting: B5 g# ^, r# _: P8 s0 {" _+ @
attention due to their convenient location and proximity to downtown
T1 u$ p0 k% }9 f* damenities.
( X% T3 _; R$ [# c
/ Y7 ?' Y2 p8 s$ M Y% i$ n The housing market in Toronto sustained healthy activity levels( m4 |. A @, K# M) J
throughout the third quarter, as a strong economy helped to maintain demand
! i& w* i. y# s3 o! O5 p- Eacross the city, causing average house prices to rise moderately. Toronto has3 \0 K) N9 W4 v+ |4 [1 g
continued to experience modest growth in average house prices, and has been5 t- ^! C/ k3 {' F0 o( Y; a
driven primarily by purchasers who are buying homes as their principle* \+ l$ R' }% n" Q { }. b
residence, rather than for investment.) w1 q& G9 l. V4 x+ Y9 z
1 {" o# q" M1 C. Q" M! I The vibrant Winnipeg housing market continued to show its strength as
5 X: v0 v0 }) l" Thouse prices rose during the third quarter. The booming local economy resulted1 s7 d8 M1 e# P8 x
in a historically low unemployment rate, helping to bolster consumer
$ }9 k, u. Q6 C8 }1 b# Z5 q! econfidence and Winnipeg's ranking as the city with the lowest capitalization
" q+ y% W# Q5 vrate among the country's larger cities - helped to encourage buyers to enter
+ [9 g0 ]' T) O% M8 J4 dthe market.
3 e2 ?9 ^" r0 F7 e( g1 G
. |! |; w1 X/ e* U4 D& }4 j' }. [) B In Regina, the market experienced a slight seasonal slowdown through* c j ]- d, s }
July, as there were fewer purchasers in the market due to summer vacations. In
8 D. j. o) E) D0 HAugust, activity resumed to the busy pace previously seen in the spring' W, `: @7 C1 A+ z! x
months, as the influx of purchasers made it more difficult to find a home due
/ a+ N1 o- G7 J1 C8 Z0 N# V. P# pto the shortage of available inventory.
7 L5 \4 R' C8 I0 g
! K8 u$ C. y0 d0 _/ a( q! G Activity in Saskatoon remained brisk as the market maintained its
" A2 R1 N0 T2 Xmomentum from the busy spring sales period. The economy in Saskatoon remains# r) {; [# F$ V8 Z* Z9 t6 s
vibrant, as employment opportunities are abundant with many businesses
) c5 M1 A; ^9 M8 \) B6 fstruggling to make hires and having to recruit outside the province.
: B* s" [3 K v8 h2 X" O7 S+ A. n$ i V6 `" I/ l" p8 y" G
Calgary's housing market recorded blazing average house price increases6 Y" S6 e y2 C) f* O
in the third quarter, in all surveyed categories. The burgeoning economy, low/ I: h( N) }$ I0 t$ M$ ?
unemployment rates and low inventory levels remained the leading factors that+ E' Q+ f( w8 H1 \' R
pressured Calgary's house prices upwards. However, regardless of the soaring
# a M, R, f0 z' h* P5 a( {prices that characterized the market - even during the typically slower summer
1 k1 o' w) j. lseason - it is expected that activity will become slightly more balanced, as) K) s; [. c' _
buyers are becoming more reluctant to participate in the frenetic activity.
* a y7 a" l) t9 N7 z
* J3 `2 g7 c2 ?: V. M' D( } Edmonton's booming local economy continued to thrive in the third quarter4 v% [0 ?2 H6 d5 S0 Q. C& I
as activity in the oil sands north of the city continued to flourish. Edmonton* r1 K9 K& Y6 S
remained the hub of activity for those coming to work in the oil industry,7 `. h# `: c: e; B: N1 D/ o8 j
maintaining tight inventory levels across the city, resulting in prices
, r$ {0 G2 }8 z+ ~6 h$ bincreasing at record levels. However, as inventory levels continued to improve
$ j. v" f% B6 C, l- y- N. kin the third quarter the rate of price appreciation should moderate slightly. m( K- `) b5 h9 o* N& |5 b$ d) \$ Y
towards the end of 2006. ! d4 P- P# W& y9 B
: F, k" X$ H9 W, ^) a8 M/ H& _While Vancouver has seen a slight reprieve from the severe shortage of
! {. ^- }9 ?9 c9 c( C/ Q) [inventory that had previously characterized the market, supply is still unable+ p. b% u) D& O4 M
to meet demand, driving house prices upwards. Vancouver has a very diverse
9 G1 N; k1 @3 @% agroup of active buyers - from first-time home buyers to baby-boomers to" I$ c) e' P: Q# {4 ^7 C
foreign investors - all of whom fuel the demand for houses, placing added
# E5 N1 n& O, k( w. ?pressure on tight inventory levels.* N) U2 ^" C% Q; t
5 w# ^) g* K8 s4 t' f Victoria's market is vibrant and supported by strong economic" B5 W: [- w" u! L7 ~
fundamentals, fuelled by a booming tech sector and a migration of young people9 x/ D1 k: I1 y8 f
into the city that has continued to support the area's house price increases;/ l) w( j6 I- s0 T3 M8 x" U/ s2 e
while increased inventory levels have afforded buyers more time when searching3 A& U" b& b6 c2 ]- L
for a home, helping to normalize the market's pace.) p+ [+ @8 D" q
2 z* R) c8 H4 l8 m. ~8 B <<; H) j4 }( N3 _/ C
Survey of Canadian Average House Prices in the Third Quarter 2006
6 j3 f+ p3 e+ {- e( `0 U1 Y( |" f
-------------------------------------------------------------------------; M( k! h4 F( J0 H
Detached Bungalows Standard Two Storey! c7 P* ~* W* G" | c9 `" C
-------------------------------------------------------------------------
}9 X3 ^! n/ x) Y 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3. N3 n3 S$ ?+ i- O+ v! `
Market Average Average % Change Average Average
, A0 c6 j# f# h& H) g2 y. c8 F -------------------------------------------------------------------------
: ^ h, \/ T, ~% y) e) ^ Halifax 186,333 173,333 7.5% 198,667 199,0002 w2 t7 n: l5 R. H. W8 x! [! u
-------------------------------------------------------------------------8 ?5 D4 M2 P0 Q" U
Charlottetown 145,000 141,000 2.8% 175,000 170,000
, X4 ?- |) j! C" s2 Q" ]. f -------------------------------------------------------------------------
; |& j3 O' E3 q6 `- z Moncton 135,000 127,000 6.3% 129,000 123,000
8 ]+ |) v. ~* @! O: e ]$ P -------------------------------------------------------------------------& X8 L# U! w9 v
Saint John 141,200 142,900 -1.2% - -7 g y3 {! S- @& [1 V4 P! L2 Q+ |
-------------------------------------------------------------------------) m3 c9 r$ [& q, y0 i; r( M) T
St. John's 143,667 142,667 0.7% 200,667 202,333
0 U8 d. a: v) U, z# M0 I3 o -------------------------------------------------------------------------
8 v; }! F- i% b Atlantic 150,240 145,380 3.3% 175,833 173,5832 ~/ Q3 v) G; O
-------------------------------------------------------------------------
$ |! p8 X Q/ E0 N Montreal 213,691 203,500 5.0% 321,141 316,1859 [8 }( n7 g. f! S0 s L
-------------------------------------------------------------------------2 o' B. S1 J! j0 w4 S& ~/ ~
Ottawa 290,083 278,417 4.2% 285,667 273,250
3 N5 C- l1 B1 n -------------------------------------------------------------------------
/ {# t3 ~4 n$ }9 H, S4 V Toronto 373,368 355,882 4.9% 481,523 474,766
' O" _2 y0 ?$ M# h0 X' u8 w -------------------------------------------------------------------------
% E4 q* E+ ^2 { I) i Winnipeg 181,579 159,860 13.6% 202,337 180,707
s1 x' K, ^8 ]( O: v -------------------------------------------------------------------------) d2 ^9 n0 e) _2 y' V
Saskatchewan 170,667 156,083 9.3% 182,600 166,500: N0 \' w+ `% h, m5 f
-------------------------------------------------------------------------2 @% h0 X5 J L& Z6 ]
Calgary 395,067 252,411 56.5% 405,778 264,389
. T, R; B- B, w/ R& i4 p! A3 f -------------------------------------------------------------------------
' o5 v' W* p) ~* U. R Edmonton 286,857 194,857 47.2% 316,429 206,714( X% U: c0 K; K' Z2 I- \
-------------------------------------------------------------------------% h. ]# @5 _/ Z- F/ ^5 b+ [2 p3 g
Vancouver 704,250 601,000 17.2% 794,000 697,500
7 Z. F0 e: d2 }: p& a4 x% b/ R -------------------------------------------------------------------------
( O. p) R% g. O6 F0 j* J Victoria 375,000 348,000 7.8% 403,000 391,000
3 ]: k' S% j" [. j! f8 D b -------------------------------------------------------------------------$ g" w$ Q9 S5 O* R) ]
National 300,365 258,202 16.3% 365,380 322,860
$ d y) ~ s: j -------------------------------------------------------------------------
; i1 m, x' C: ]3 v6 B
9 P* i/ T# p% h8 r -------------------------------------------------------------: x l; Z4 A' |) x& |" Q
Standard Condominium
# a1 R( m$ A! q4 ~4 j -------------------------------------------------------------, Q$ [5 r _7 x3 C" m, F+ o: k: \
2-Storey 2006 Q3 2005 Q3 Condo
" |( o; j$ x* T! q- |% M1 ?& I4 z Market % Change Average Average % Change
2 a; U" c6 ^4 J! i$ z/ G$ P3 N# Z -------------------------------------------------------------& K) x- O' |7 j1 I
Halifax -0.2% 142,000 103,000 37.9%
A4 { q t" U0 L3 s$ D) ?5 ~ -------------------------------------------------------------) M: A! [6 m5 K8 z* j: @
Charlottetown 2.9% 98,000 98,000 0.0%
3 v4 ?* y$ Y6 [# u+ X -------------------------------------------------------------
* L: z- a3 ^. W( z) e m2 H1 I% \ Moncton 4.9% - - N/A
: l! c8 s8 Q2 u+ W' a -------------------------------------------------------------1 W5 f1 F- C7 q6 s8 s1 ~+ K/ E; r
Saint John N/A - - N/A
. x- d$ W) J g% L! w% W+ @ -------------------------------------------------------------
2 }7 w' V* R j2 Q$ t# u St. John's -0.8% 146,333 145,667 0.5%) v+ L: P6 D1 p: I
-------------------------------------------------------------8 d4 {/ W1 q B9 I
Atlantic 1.3% 128,778 115,556 11.4%5 K: _ q, L3 l$ A
-------------------------------------------------------------3 P4 Z7 g" r& U( }
Montreal 1.6% 193,190 188,016 2.8%
" H' r1 Y1 k8 j0 ] -------------------------------------------------------------4 s2 y" ?4 P* `
Ottawa 4.5% 181,083 172,250 5.1%& I9 A* r& W+ s7 q& T
-------------------------------------------------------------
8 x& p0 H* z r! M Toronto 1.4% 252,088 242,918 3.8%
: o# g3 T) k+ M: _3 e -------------------------------------------------------------, b) `9 x, c9 E+ _ I
Winnipeg 12.0% 105,648 96,008 10.0%1 c5 K" r7 v9 [3 x2 e! ?
-------------------------------------------------------------
0 r8 h( Y) o& F( h+ v0 p7 C) W8 M Saskatchewan 9.7% 106,250 101,000 5.2%
& z! G9 j; o$ P% t$ s -------------------------------------------------------------7 L3 Q8 I1 s2 r M5 Z! V% G9 Q
Calgary 53.5% 245,844 153,867 59.8%
: F' l7 [2 n6 y- [8 B9 x+ S -------------------------------------------------------------9 Z- w8 \/ Z/ o x
Edmonton 53.1% 200,433 131,500 52.4%, B% d8 P1 U9 m1 z+ H6 `8 O
-------------------------------------------------------------- v/ ^3 L |0 H7 ?' p/ i
Vancouver 13.8% 366,250 323,250 13.3%, h4 g/ y! ~: u3 E5 s, A
-------------------------------------------------------------
9 V7 l8 `( n! _, ~ Victoria 3.1% 229,000 220,000 4.1%
/ ]; a: t: @" p- |! Z -------------------------------------------------------------/ Y- M. w4 t5 V3 o, C( Q3 a
National 13.2% 211,562 185,296 14.2%) l9 e; ]! o2 c- C+ I6 P9 N" b
-------------------------------------------------------------
, s$ ^4 T8 h; G- Z: e+ j >>6 O8 d; W/ e& N7 W4 @" L: q
/ a O5 K1 y' \
Average house prices are based on an average of all sub-markets examined
7 s, y( W5 E& `' y4 ?, C4 Kin the area, except for the smaller markets of Charlottetown, Moncton, Saint2 a% H0 q# K, K. b C7 q3 c
John and Victoria.
5 k v9 P/ s6 Y1 V5 k. B, u/ I$ r% H ?7 j
The Royal LePage Survey of Canadian House Prices is the largest, most" |6 f. X5 ]. _+ }1 `
comprehensive study of its kind in Canada, with information on seven types of$ S/ s6 f3 R+ e1 {& r
housing in over 250 neighbourhoods from coast to coast. This release
# {. i3 }. j/ ^9 K* Q& mreferences an abbreviated version of the survey, which highlights house price3 U: \4 s3 M) K2 z- U( _) ?
trends for the three most common types of housing in Canada in 80 communities" z6 X$ t0 D' a4 q
across the country. A complete database of past and present surveys is
; }8 S2 e% I; s$ K+ v% w8 ], gavailable on the Royal LePage Web site at www.royallepage.ca, and current7 f0 ~) U9 C: L- P4 m$ a! ~/ {# S
figures will be updated following the end of the third quarter. A printable* Q" }; [# {" [; }. U5 j, ^
version of the third quarter 2006 survey will be available online on6 C# [ w% I% T" @
November 15, 2006.' g, y7 L0 f- w5 s) J5 Q
Housing values in the Royal LePage Survey are Royal LePage opinions of
( Z9 w, U' g- } C0 [fair market value in each location, based on local data and market knowledge
0 X. E9 Y, k9 i% Y* }$ H7 Wprovided by Royal LePage residential real estate experts. Historical data is
. O5 O. ^; M, R2 ^( M, Yavailable for some areas back to the early 1970s. |
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