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Canada's housing market both vigorous and stable s6 `+ ~$ y' F& A6 `
& T( I5 C) \5 Z- Country's market poised to show growth throughout 2006 -, M3 M5 }5 w; ^9 I6 n6 o% I0 O2 Y
2 b6 t, k' R1 \ m$ s( k+ ]
TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
6 \0 O) V5 I }% ~( D' n: ]/ H: Eexhibited moderate price increases and stable unit sales during the third
7 P" f2 h+ S, fquarter. Wide regional variances continued to be the dominant characteristic: j! h) Z3 h. F- e1 b1 L
in the market, exemplified by frenzied levels of activity and double digit+ C" P" o. _2 v Z3 Q
price gains observed in the energy and commodity rich Western provinces, and Y9 |. B8 b4 j: }
more reasonable sales volumes and moderate price appreciation in Ontario,
2 _" V( B$ K7 B) A' @# _& c7 qQuebec and Atlantic Canada, according to a report released today by Royal
/ h, Z% q" r" X {7 C/ Y4 f) YLePage Real Estate Services.
O# T9 @+ U3 N
* T# [$ ?) W" f9 I- K' t Nationally, market trends established through the first three quarters- h9 W% v. |6 c: a+ t5 L
are forecast to continue for the remainder of the year. Robust economic
$ v; W+ p/ y0 E# G5 h wconditions, low unemployment rates, modestly growing salaries and wages, and2 \% \( q$ U( u
sound consumer confidence contributed to the overall strength of the
# S, z; T3 F% {; I% \residential real estate sector.
( K9 A e. T9 g% L8 A! D( v' `* t' K% }6 u- Y: T a* y5 E
Of the housing types surveyed, the highest average price appreciation
/ H$ M8 ~" I- u3 s; L0 s; {1 ~occurred in detached bungalows, which rose to $300,365 (+16.3%)
! P3 ~3 `& u2 ^) Vyear-over-year, followed by standard condominiums, which rose to $211,562
5 h' G9 ^3 B; v% d4 ^. F(+14.2%), and standard two-storey properties, which increased to $365,380
3 e7 m# P/ @2 c, _ n' q% J$ u- w(+13.2%).7 Z8 h, m, G6 I V: q
2 t$ s+ v% a9 u7 A2 }- Z. a5 u7 O "Canada's sturdy housing market continued to demonstrate steady growth' n3 @7 x: ~; N& u& V" @3 f% c: l
during the third quarter. For all but the west, we have moved on from the+ j. w) e5 H8 O) l
frenzied expansion that characterized the first half of this decade, and are
0 j5 n( B9 x5 Q- m. h% ?/ Epoised to show continued growth at a more moderate pace," said Phil Soper,8 d3 ^) x# ^. @: E. h* N
president and chief executive officer, Royal LePage Real Estate Services.% W# C2 y( m' W) b4 x
"Gone is the sellers' market that we have lived with for some years. We r9 n V: m8 l z" q3 `3 `+ T
welcome the more reliable conditions that are characteristic of a healthy5 L7 t" W y. t1 s, s
balanced market."
f/ c2 `0 A! ]( E6 V& Q# R4 a) `0 \
Despite the double-digit rise in average national house prices,8 a. [6 U. Q( ^# d
considerable regional variances were exhibited again this quarter. The shift: B3 x* P- `. q# B
to balanced market conditions, which began in late 2005, has continued8 n, K2 \: O# t, T, g9 {* H
throughout most of the Central and Eastern regions of the country. In the core, ^7 \( t' }9 J% L" K" i
energy producing western provinces, the combination of very high in-migration,( v* }5 }( T2 e1 {) b
manageable affordability, and a shortage of inventory has driven record
1 a5 d+ A- D7 V/ ?; R: ~, I& f0 }breaking price appreciations.# t+ {: @; r% U
; p& T* N" E1 L/ G
Echoing the second quarter and supported by Alberta's rapidly expanding* ^* D/ y% A1 B a" T+ v6 c
economy, Calgary and Edmonton led the charge of Canadian cities with the
7 W9 L7 b. X& }0 E" Xlargest house price appreciation in all housing types surveyed.* n* F: `( t* h; n3 p l- r
9 G- P# c( G- m( {! j$ P In Ottawa and Toronto, growth remained steady, supported by solid" K8 a _7 O0 T! `% ?/ l
economic fundamentals, an increase in available inventory and strong consumer
l- }5 U B* v# M( cconfidence. While the pace of price appreciation in Ontario leveled off
7 k8 s; W" ?& a% [8 fslightly, the province's real estate market remains poised for modest growth.6 a$ N* D" {3 a$ v
In Atlantic Canada, new housing and condominium construction offered buyers
: n; O& s) X# E( G) |$ Dgreater selection at more competitive prices, resulting in a slower rate of
9 A1 A- w# E8 o6 m$ c: C: @' q/ cprice appreciation when compared with 2005.
3 d+ _5 T H. @) I* V( P& n( S- _6 r' }
While the pace of growth in Canada has slowed, the domestic housing
/ x& r8 c5 ?! l7 ?$ ~" ]; J: Nmarket is expected to outperform the American market. The economic and
' \: N, l) k* Y/ ofinancial fundamentals driving the residential real estate sector in Canada( z: W' W' ?7 ?& T. I* C9 \* T9 w5 l
are markedly different than those found in the United States.
( a: k% y' N! U) s" z g5 p0 ^
. R+ ?! F- H+ ~- J2 A3 S- i1 } Added Soper: "Canada's housing market is likely to outperform the
# r/ [% b. c# i& x8 e UAmerican market through 2007. A number of factors are working in Canada's% z# g/ k M7 M5 s$ M
favour, including healthy personal and governmental debt levels, the
# L9 _6 [* |. R* Zrelatively modest rise in interest rates in our country, and general
# q* [/ O, K7 X9 A% U& Paffordability in our major cities. In addition, Americans are now seeing the
7 d( `7 p* \0 `. i k# q; Ddownside of a tax system that encourages maximum homeowner leverage, and
" {" F1 D: K+ l) waggressive financial products such as zero- and negative-amortization
# O P* f6 ` T$ umortgages that work only in a high price growth environment."4 v6 E# L. g$ T3 u0 @& N+ W, p* ^! }
- H: L Y9 H z: ], q; X8 D$ }
<<
3 q# c1 {$ Q# w1 h REGIONAL SUMMARIES7 {) u3 f4 z4 X2 C
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3 f$ m" H* k3 w7 @
Balanced conditions continued to characterize the housing market in5 E6 I# D7 x$ K; h
Halifax, as significantly higher inventory levels helped to moderate the rate
% j! G- }. ~0 E$ P( f! y2 ?of price appreciation. Buyers were increasingly choosy, taking more time
: J ]( n5 A) y+ E. ]looking for newer, low-maintenance properties that were not in need of
9 p! q [/ s0 Q5 M- H3 u5 srenovations.) m Z+ A f5 G+ \8 k& n% u M0 Z
5 a. e+ v1 K' S; V The housing market in Moncton remained healthy and strong as a slight4 Y$ S; C0 u2 X) d; l5 B
increase in inventory helped to moderate the rate of price appreciation0 E* M* R# X4 i+ q. G. D
compared to the same period in 2005. Activity was brisk throughout August and
, S: H7 o8 G9 M* R0 F. s- OSeptember and is expected to remain this way through the fourth quarter.
4 r" L" _& l2 P, p8 o. w$ I1 p' x* N5 {+ n( \
The housing market in Saint John underwent its traditional summer
6 F9 h* z0 c' R' islowdown in the third quarter, with activity picking up towards the end of the! t& \7 o1 T% v; u8 v3 ` Z/ z: T
quarter. The local economy continued to thrive, as construction on a new, p% Y; S( {, k y/ P! ~5 D2 s: v
600,000 square-foot shopping area has begun, bringing several new box stores
% @) n* w# w. z1 ?" [2 I& Eto the area. Buyers have begun seeking less expensive fixtures for their homes* u+ s) Z- J6 x9 J" @3 {
and are instead opting for more affordable housing options.2 p# @; f. Y* j' w
5 d- e$ e8 i# Z m% B
In Charlottetown, the housing market started to move towards balanced% q/ C6 y0 [0 M( a( y+ F
conditions, as some sellers had to begin to lower the asking prices on their
0 H ?& [& s4 V6 bhomes to make them more competitive. Activity from out-of-town and US buyers
2 e; \" ]" h. B; p4 m; F+ N* Wwas down slightly compared to 2005, likely attributable to the strong Canadian, y# C+ P6 [/ E; d: o; Y& U
dollar. Inventory levels began to creep up in the third quarter, providing
* A' M& L- }8 tbuyers with more options when looking for a home.$ O5 F* G# p& i' B
* ~3 n, | Q4 x. i$ A
Activity in St. John's slowed slightly in the third quarter, particularly# B1 d7 h: ~" }: Z$ V% @
among higher-priced properties, where there was a slight over-supply of homes
$ O2 {+ D6 e. @" e4 j/ Qpriced over $200,000. Listing periods have increased when compared with 2005,
3 _9 c# \( q+ _7 |2 B6 x' ~as some of the pent-up demand that had characterized the market over the last3 o3 ]9 C) {5 ]; j, d
few years has been satisfied, resulting in more normal, balanced conditions.
. F; p4 b0 I7 V$ u+ s
. @# i( H6 D @" B! R6 _2 Q Montreal's housing market recorded modest increases in average house
0 }( C9 B( g6 [, e) wprices, due to a slight seasonal slowdown in the third quarter as inventory
) R+ ~+ h$ `) L E7 y" H+ Slevels rose. Part of this can be attributed to the fact that many renting
9 M& G" w; [! F, w" i" dfirst-time buyers were motivated to close on the purchase of a home by July 1,
( I) H) Z; A& @! G5 Swhen rental leases expire in Quebec. Once this date has passed some of the
, I( t1 }1 s$ f+ Qpressure is taken off the market, allowing buyers to visit more homes before
5 Z3 _% c/ `$ k, Qmaking a purchase.
6 H! w2 R& h$ u) a" ]
. l, n v/ _ @* i8 Z9 d2 \ Ottawa held its position as one of the country's most stable housing
: ^8 ~' V* T. Ymarkets in the third quarter, reinforced by a vibrant local economy and strong
# W b' h) a$ c- h% nconfidence, resulting in modest increases in average house prices. The city
1 c8 Y# w3 Z h( C1 j8 {centre remained a bright spot in Ottawa, with homes in this area attracting
2 {( f) F! v$ J2 |attention due to their convenient location and proximity to downtown
5 }) |! N% `- _# q% f& kamenities.
1 }: P& n$ y6 j9 E
8 @' _0 m* c+ A1 Y& b The housing market in Toronto sustained healthy activity levels
% S' B5 l/ l6 c% c2 |throughout the third quarter, as a strong economy helped to maintain demand
5 I; g }" G0 `6 racross the city, causing average house prices to rise moderately. Toronto has
8 G, n; V" }. i5 s& Ncontinued to experience modest growth in average house prices, and has been1 f- \+ J( I' R1 F# y+ R6 ^
driven primarily by purchasers who are buying homes as their principle
( |7 D3 i; u2 e: w1 _residence, rather than for investment.
6 R) f& M- m7 U, q. ]7 H: \% `0 x1 z( U# I6 [9 q
The vibrant Winnipeg housing market continued to show its strength as$ r# Z5 }: x4 R
house prices rose during the third quarter. The booming local economy resulted
$ [" |) ~% k3 E* v: `4 d0 Kin a historically low unemployment rate, helping to bolster consumer
( s- @6 J$ y# P, }9 Hconfidence and Winnipeg's ranking as the city with the lowest capitalization: B @" G( n- U" M7 l
rate among the country's larger cities - helped to encourage buyers to enter7 g! c% ?3 G% K v+ ~4 O
the market.
$ [1 z/ c c7 _
+ \; H( H* S. p In Regina, the market experienced a slight seasonal slowdown through
0 N' j& B7 j& W, x$ CJuly, as there were fewer purchasers in the market due to summer vacations. In, w- S( k: M+ [' f
August, activity resumed to the busy pace previously seen in the spring; q9 e: Q5 W; x
months, as the influx of purchasers made it more difficult to find a home due
( p9 O o) O& c% Qto the shortage of available inventory.
3 j- w' B8 V: F8 J2 ~! I& l; y( ]. n" {. c0 C) u3 N! @1 |
Activity in Saskatoon remained brisk as the market maintained its
, x3 H4 T/ k6 t/ ~momentum from the busy spring sales period. The economy in Saskatoon remains/ H: t& V9 R& N+ S
vibrant, as employment opportunities are abundant with many businesses/ I; o' ?% @3 I: x0 Z
struggling to make hires and having to recruit outside the province.1 B5 { I+ `/ v5 c
* X) P% i, h" z Calgary's housing market recorded blazing average house price increases
/ X; Y! G0 h$ S7 V. q0 S1 iin the third quarter, in all surveyed categories. The burgeoning economy, low- x' l$ `* S1 u) @7 L# Y% T
unemployment rates and low inventory levels remained the leading factors that
" o+ k( r z' D4 n3 A6 tpressured Calgary's house prices upwards. However, regardless of the soaring2 O& a$ `6 q7 z, t
prices that characterized the market - even during the typically slower summer. h# Y9 z$ M6 P9 G) ^( l3 j
season - it is expected that activity will become slightly more balanced, as
5 b/ g& j& m; g+ `1 G6 Abuyers are becoming more reluctant to participate in the frenetic activity.
, B8 |3 K4 c9 \& c2 |( @
) U' {5 A- r- s+ ?$ @6 N Edmonton's booming local economy continued to thrive in the third quarter& w, L" H) C, z5 o% R8 W
as activity in the oil sands north of the city continued to flourish. Edmonton9 \$ R a2 k5 R H1 S" i c& R
remained the hub of activity for those coming to work in the oil industry,! |& D$ u: [/ D* q# J
maintaining tight inventory levels across the city, resulting in prices
9 S" A4 j, e; b2 ?+ sincreasing at record levels. However, as inventory levels continued to improve# o2 c0 c% R& m+ B+ b; W. Z
in the third quarter the rate of price appreciation should moderate slightly
5 ^! ^" T$ f, U& l8 atowards the end of 2006. % e& L5 v) A( ~
3 i8 E4 z7 k) F1 [- P6 n \While Vancouver has seen a slight reprieve from the severe shortage of
% l! C, y; m1 r! O- Winventory that had previously characterized the market, supply is still unable
! p) C# n# t$ lto meet demand, driving house prices upwards. Vancouver has a very diverse
+ D3 {9 ~- x5 }group of active buyers - from first-time home buyers to baby-boomers to8 S0 q( M1 X, b j
foreign investors - all of whom fuel the demand for houses, placing added2 f. A. i3 }- g
pressure on tight inventory levels.
/ f( x8 V+ J" Z( i7 x& A! T/ q6 w: V X$ x9 B4 f- e4 C
Victoria's market is vibrant and supported by strong economic5 A# {% I o( ?3 S7 e
fundamentals, fuelled by a booming tech sector and a migration of young people
V4 N/ W$ |: G5 \into the city that has continued to support the area's house price increases;) m2 M( b; {% i. |5 Y( r* V8 W
while increased inventory levels have afforded buyers more time when searching! x* V% G+ v- i& S6 }7 X
for a home, helping to normalize the market's pace.
4 L) |) C! c: K4 e' o. p. ], A' H1 o: ?" D: x
<<) S, N5 \. c' C" d+ D3 p0 a
Survey of Canadian Average House Prices in the Third Quarter 2006
6 M- S: [& ?- d6 g' ]* n6 [$ a9 `" G( F( E+ I# E
-------------------------------------------------------------------------
( n0 l$ t% j8 w4 P* z2 O Detached Bungalows Standard Two Storey; {; T% a# n- T: b0 F$ `
-------------------------------------------------------------------------' F% k' U x2 c+ p% j0 [5 [3 _
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
' ]7 N1 K+ T! `! l7 i& O2 v Market Average Average % Change Average Average
7 g2 {8 F2 k$ h8 y2 Z7 @ -------------------------------------------------------------------------
/ y6 d- n" a5 s W5 [ Halifax 186,333 173,333 7.5% 198,667 199,000
0 j1 n1 J! i% X/ X1 w, w; T! ? -------------------------------------------------------------------------
( ~- }7 c4 k% Z- E Charlottetown 145,000 141,000 2.8% 175,000 170,000
: N$ |' j- K& f+ _0 z -------------------------------------------------------------------------) j3 ~3 @7 g/ W! I2 ]
Moncton 135,000 127,000 6.3% 129,000 123,000* x& \% J9 Q$ _. |
-------------------------------------------------------------------------1 n/ p( J5 v! [4 W8 Q- |4 i7 E
Saint John 141,200 142,900 -1.2% - -) O% u. P: P* p: s5 u+ G! ]; p# u. J
-------------------------------------------------------------------------* `2 j8 G' v4 X2 P) ?# h, u2 b
St. John's 143,667 142,667 0.7% 200,667 202,333
2 S& ?. z" g# g) V- K2 T/ h5 X -------------------------------------------------------------------------
" t0 @/ w- A2 L G' B Atlantic 150,240 145,380 3.3% 175,833 173,583
% A: h) t% O" b/ A -------------------------------------------------------------------------( E- p2 a" |1 \, `7 S4 G
Montreal 213,691 203,500 5.0% 321,141 316,1851 P5 ^4 Q/ X; ? \: Q, `0 X$ B& M
-------------------------------------------------------------------------
. ]% z* S; s" @/ F' q: w# ~ Ottawa 290,083 278,417 4.2% 285,667 273,250
/ M# ]" P1 D" j -------------------------------------------------------------------------
8 A0 j* U: ^* b Toronto 373,368 355,882 4.9% 481,523 474,766
9 O+ g7 R% y0 z7 Z. C -------------------------------------------------------------------------' L7 @0 O, e& h1 k
Winnipeg 181,579 159,860 13.6% 202,337 180,7071 c8 y1 I' _' I. a' k2 F, C
-------------------------------------------------------------------------
- v- ]& x4 w9 H Saskatchewan 170,667 156,083 9.3% 182,600 166,500
8 V, h6 `+ c' q: c( l. T, d -------------------------------------------------------------------------
& {- o$ _ u) }* L. \: i Calgary 395,067 252,411 56.5% 405,778 264,389
( D8 d; ?# s0 e) k. f -------------------------------------------------------------------------
7 g0 ?+ s% T2 F: ^+ g- }2 h. U: L Edmonton 286,857 194,857 47.2% 316,429 206,714 I2 u8 u/ P" S
-------------------------------------------------------------------------: O3 N" {; z+ S3 }0 s3 J: s1 U
Vancouver 704,250 601,000 17.2% 794,000 697,500. c U8 _7 E- ]! N$ Y# f7 z8 C4 n. k
-------------------------------------------------------------------------/ U( R8 Q% C/ S- i) `3 I
Victoria 375,000 348,000 7.8% 403,000 391,000( H4 P, S9 P1 M3 c9 Y
-------------------------------------------------------------------------2 Y: I% X5 v/ m* i
National 300,365 258,202 16.3% 365,380 322,860
& i$ r- X N( d/ X -------------------------------------------------------------------------
# {1 C& ^- {3 \- S" ^( R5 g v# y/ v: Y7 S
-------------------------------------------------------------% X! q/ m5 ^% T
Standard Condominium
+ l4 c; f1 A5 N7 [( Y. v -------------------------------------------------------------) c. \: X+ i% c' t2 w: i+ ?
2-Storey 2006 Q3 2005 Q3 Condo9 H7 b3 S9 i5 o1 N: p; D
Market % Change Average Average % Change8 F+ ]. {& F% O5 l/ x1 w% L
-------------------------------------------------------------. {6 W3 E& Z1 a8 d
Halifax -0.2% 142,000 103,000 37.9%. i# l6 `$ M+ ^ B4 Z, V5 Z0 }# {
-------------------------------------------------------------% s, Q! }2 F! ]3 _' Y$ H' s4 R3 U
Charlottetown 2.9% 98,000 98,000 0.0%$ C" m0 R3 ~7 _, y' T# u. p' d
------------------------------------------------------------- L' l' |4 O$ b$ g1 @6 p+ g* Y
Moncton 4.9% - - N/A$ R1 Y& C! \$ x2 B) v, B. L
-------------------------------------------------------------
T8 E) T5 B# L7 M7 ?3 Z. C/ y Saint John N/A - - N/A
. ?) v/ j" d/ f0 I+ q/ { -------------------------------------------------------------
& Q) P/ w. \) ]& }6 l4 f St. John's -0.8% 146,333 145,667 0.5%! t+ P/ r" Z, G) c* p) k. g: o
-------------------------------------------------------------+ c3 q/ B. l; e3 J! s' x7 m% y p9 V% V
Atlantic 1.3% 128,778 115,556 11.4%
% l8 z) a. B7 O -------------------------------------------------------------
9 Q' e" L1 E. c S Montreal 1.6% 193,190 188,016 2.8%
' y7 O( E E+ @( }# l$ ]3 g1 \ -------------------------------------------------------------
$ D/ s: g, |! t a Ottawa 4.5% 181,083 172,250 5.1%
/ d0 D( D) Y/ W2 \5 O -------------------------------------------------------------
0 o q/ a' J, R h6 ?. T9 F3 ` Toronto 1.4% 252,088 242,918 3.8%+ b& I! N& j$ [- j
-------------------------------------------------------------
5 ]. g6 l% |$ S0 m6 r+ e; }1 q/ L# s Winnipeg 12.0% 105,648 96,008 10.0%
6 j m: s3 v& Y! @ -------------------------------------------------------------8 ~) P& q6 _* r5 J& W2 T
Saskatchewan 9.7% 106,250 101,000 5.2%6 \0 ?( i4 x& R- P" {: [1 A
-------------------------------------------------------------
: ]/ A9 T5 Q4 R1 k# I6 N Calgary 53.5% 245,844 153,867 59.8%$ i `4 ^% I& G. v$ T
-------------------------------------------------------------
$ X! E* E, t7 Z/ u& M0 X3 H Edmonton 53.1% 200,433 131,500 52.4%
% I& g' D" ]6 ` -------------------------------------------------------------
. P* l$ q2 N; L. J Vancouver 13.8% 366,250 323,250 13.3%
' @* {( n' b2 o9 y+ P4 o% P -------------------------------------------------------------# b$ n+ r+ Y5 i3 r
Victoria 3.1% 229,000 220,000 4.1%
, o2 K# E, }: |5 d# J -------------------------------------------------------------. F; `3 T' ^! g* C" {$ P8 u- X- ]
National 13.2% 211,562 185,296 14.2%. |% V; a8 z3 T2 d4 O9 D% u- k9 B
-------------------------------------------------------------3 }4 |: x& B- Z7 j
>>
1 D% m+ |, W" f! y6 f- @, v" y6 A- m7 J8 Z8 @2 K
Average house prices are based on an average of all sub-markets examined, z( j6 E: P) g$ a' l3 a
in the area, except for the smaller markets of Charlottetown, Moncton, Saint
9 c0 A4 F% G YJohn and Victoria.
# V# }" L, w$ u$ @" _2 s! y; c8 }+ e" g* E( T
The Royal LePage Survey of Canadian House Prices is the largest, most
8 Z. \" V1 g" Ocomprehensive study of its kind in Canada, with information on seven types of
( [! r0 o( h9 x8 X8 w! ahousing in over 250 neighbourhoods from coast to coast. This release! F. e) d6 ?8 j6 A( Y7 Z; @2 y% X
references an abbreviated version of the survey, which highlights house price
T: b" C6 e9 U0 c! A+ g3 G1 |trends for the three most common types of housing in Canada in 80 communities
4 Q2 M' i l5 G9 K# gacross the country. A complete database of past and present surveys is0 K$ c; a+ G2 B/ n- W9 e0 r8 C
available on the Royal LePage Web site at www.royallepage.ca, and current
# A5 g" z$ r4 ^4 E; mfigures will be updated following the end of the third quarter. A printable
1 L' z" B8 \( |* _0 |1 }' r4 \version of the third quarter 2006 survey will be available online on
/ L4 [$ V F" W+ u2 jNovember 15, 2006.
9 J3 m1 X* g" i S Housing values in the Royal LePage Survey are Royal LePage opinions of6 Z7 @; t5 B& l( U
fair market value in each location, based on local data and market knowledge
( k* e8 t; K! B* Y) I% Lprovided by Royal LePage residential real estate experts. Historical data is
~# ` ^4 L! F0 zavailable for some areas back to the early 1970s. |
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