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Canada's housing market both vigorous and stable
. X* y& k" n# n7 x* }+ S% r s$ U8 o- h/ B4 M; ?" c
- Country's market poised to show growth throughout 2006 -. e* t! X# f+ d
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TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
3 ~8 I2 {. J! t, t! ]; G0 i9 nexhibited moderate price increases and stable unit sales during the third
1 f7 `6 r5 c. `! y* p) |% @- iquarter. Wide regional variances continued to be the dominant characteristic
" E& D/ W% T5 ^" uin the market, exemplified by frenzied levels of activity and double digit
$ h1 S5 O% H$ `% R9 {# T- iprice gains observed in the energy and commodity rich Western provinces, and: `, A! o! ]5 ~% h
more reasonable sales volumes and moderate price appreciation in Ontario,4 l6 k: L2 {3 ~1 F- b3 A2 _
Quebec and Atlantic Canada, according to a report released today by Royal
) ^) r4 o V+ GLePage Real Estate Services.% q& G p; |, O, u* N
' F: [- m6 A4 Z
Nationally, market trends established through the first three quarters
+ C' j' |' Q3 O* l- D# i- Xare forecast to continue for the remainder of the year. Robust economic
( P" j$ h4 G5 ^conditions, low unemployment rates, modestly growing salaries and wages, and- h2 ]- L6 c; d1 v7 h
sound consumer confidence contributed to the overall strength of the- h+ N) e! V! T
residential real estate sector.* q! q9 b. N+ j5 L
$ U0 m1 T! N7 ~! r. d0 o; j% p# {
Of the housing types surveyed, the highest average price appreciation
4 P' S$ ~) Z8 aoccurred in detached bungalows, which rose to $300,365 (+16.3%)
7 `$ m) ^+ {3 w* t% W, Hyear-over-year, followed by standard condominiums, which rose to $211,5626 D& O; R- a- }1 V C! {) f% |; s
(+14.2%), and standard two-storey properties, which increased to $365,380
1 M. O# m4 \8 K+ t0 E0 E(+13.2%).
, \* ?' K2 T; q$ U
/ h% C0 w/ B9 ]! n "Canada's sturdy housing market continued to demonstrate steady growth
' e$ N' w2 P$ y9 B( B( ~during the third quarter. For all but the west, we have moved on from the
7 |, F O0 V5 P# {" w! H0 Hfrenzied expansion that characterized the first half of this decade, and are! @ z! _* O% o; G
poised to show continued growth at a more moderate pace," said Phil Soper, f1 \/ I' R8 B5 `
president and chief executive officer, Royal LePage Real Estate Services.; k8 O3 B9 O+ Y& f5 ^+ p4 m. d* W
"Gone is the sellers' market that we have lived with for some years. We( _$ K, ?0 t1 ]9 c/ ~8 b# v z# }
welcome the more reliable conditions that are characteristic of a healthy
, A: k* r5 P+ Y3 R4 S# [balanced market."
1 P" i% ~9 O7 i
" B6 C" T8 ^6 O1 b: c, G$ D Despite the double-digit rise in average national house prices,
5 W& r6 Q! z& Z% d, @considerable regional variances were exhibited again this quarter. The shift
/ e, A7 g% T: ]. \, `. lto balanced market conditions, which began in late 2005, has continued5 ` X6 i2 D' e6 a& y( _4 u
throughout most of the Central and Eastern regions of the country. In the core& z) n& m3 n4 q1 ^. T. A6 C. Y7 Y
energy producing western provinces, the combination of very high in-migration,
; o. @& m4 c4 B: zmanageable affordability, and a shortage of inventory has driven record# |. d' `# g6 X' C7 k* U
breaking price appreciations.
5 S$ w% D# \# w9 g( M
2 O% D/ l) _% j: k: S" p! X Echoing the second quarter and supported by Alberta's rapidly expanding, v# l. r" } `$ c
economy, Calgary and Edmonton led the charge of Canadian cities with the. J$ f) ^+ G d8 i6 @
largest house price appreciation in all housing types surveyed.
. ` |' A( _! Z5 N. A1 r7 N$ e: L- T9 J) ^! ~! k5 E
In Ottawa and Toronto, growth remained steady, supported by solid
" f8 \& v. d* O0 z: Q: |economic fundamentals, an increase in available inventory and strong consumer) _4 V% V8 S6 V: I! T7 s/ q
confidence. While the pace of price appreciation in Ontario leveled off
' ^# d3 s" X5 h& }+ [+ Tslightly, the province's real estate market remains poised for modest growth.
- C% G- B; ?# {# f# j1 o4 AIn Atlantic Canada, new housing and condominium construction offered buyers& N* Q- ^8 l# |
greater selection at more competitive prices, resulting in a slower rate of4 N/ g& L* H7 ~
price appreciation when compared with 2005.
8 @2 c. B9 I; s4 N- l
6 a2 [. X+ G; H( `% V$ R: v While the pace of growth in Canada has slowed, the domestic housing- V+ c }% o" B$ [0 q- p
market is expected to outperform the American market. The economic and
4 `, W3 w7 S. m8 g0 |" R- S1 Zfinancial fundamentals driving the residential real estate sector in Canada2 y! { }' _& T ?
are markedly different than those found in the United States.; ?2 D' Q2 F. a, }/ E. F& D
1 Z# f0 Y! a$ l" H Added Soper: "Canada's housing market is likely to outperform the( T: k! q* i9 P& e- Q/ P2 p/ q1 t
American market through 2007. A number of factors are working in Canada's
M9 e1 v. L- ^# Y" qfavour, including healthy personal and governmental debt levels, the
2 @( u/ z, }3 _9 g* w* X2 k6 Qrelatively modest rise in interest rates in our country, and general
/ C) L8 b P# ?7 A0 p4 F; }5 a, haffordability in our major cities. In addition, Americans are now seeing the9 i% @: ]7 K: j+ X- y4 ?0 b
downside of a tax system that encourages maximum homeowner leverage, and1 P' i8 U' Z7 E5 D1 z. z( u' [* y
aggressive financial products such as zero- and negative-amortization" k* e; e# t. Z8 e! `% e3 ^/ y
mortgages that work only in a high price growth environment."4 }: P, u8 _1 E( ^
8 M% T" m; w& d& m9 t9 V- a2 }. C
<<
) N4 B. m' g" s( u7 I% g REGIONAL SUMMARIES
* ?, U ?) |( s! j4 B >>. i2 m$ L9 C7 j1 W1 _( {
+ Q( [! Y; F. D0 B Balanced conditions continued to characterize the housing market in
5 L( ?" u0 _! sHalifax, as significantly higher inventory levels helped to moderate the rate
. c8 e1 l. u, u/ I1 ?/ H5 U" dof price appreciation. Buyers were increasingly choosy, taking more time
% o v1 W* s# e* d6 E% ~7 W$ S: llooking for newer, low-maintenance properties that were not in need of
$ R# \; C3 T0 x( arenovations.
2 X! K( j: o: {- y7 o+ k
) W1 Q5 `2 B4 }4 S2 M8 [ The housing market in Moncton remained healthy and strong as a slight
5 Q4 K1 R7 L% \% c6 jincrease in inventory helped to moderate the rate of price appreciation; a( @0 z3 T) d$ A+ W
compared to the same period in 2005. Activity was brisk throughout August and, D! s: f, s" I- |% w% M' J8 V D; g
September and is expected to remain this way through the fourth quarter.7 p+ O% J" b+ O) S ]1 v
4 E8 A* ^7 [7 c7 m- n& i The housing market in Saint John underwent its traditional summer2 z. P) [! |7 [$ ?" ?; D
slowdown in the third quarter, with activity picking up towards the end of the
* ~; M9 ?; S* N) Y1 w/ t3 Qquarter. The local economy continued to thrive, as construction on a new0 ~' m4 |# y5 ~1 h$ P5 [
600,000 square-foot shopping area has begun, bringing several new box stores! H: o! q7 o* d: N, q6 n$ x
to the area. Buyers have begun seeking less expensive fixtures for their homes
# D1 @3 B6 L. Xand are instead opting for more affordable housing options.8 [0 T" l) F! U' t' O1 b+ M
. G. P5 [" e0 C+ H% \4 s9 E
In Charlottetown, the housing market started to move towards balanced
/ [3 D1 ~9 x! [8 vconditions, as some sellers had to begin to lower the asking prices on their. X5 M! ]8 }, P$ d, b
homes to make them more competitive. Activity from out-of-town and US buyers
+ [8 b3 G' @1 D( i" gwas down slightly compared to 2005, likely attributable to the strong Canadian' o2 h: s1 T, K. C8 M- j* U
dollar. Inventory levels began to creep up in the third quarter, providing- J+ \, R: ~" F- W7 k2 U
buyers with more options when looking for a home.! K* ~8 ]2 p8 |% k! A& n% Z
2 l/ Z( u. w9 T) ? Activity in St. John's slowed slightly in the third quarter, particularly, Z8 L5 ~& T( _; T
among higher-priced properties, where there was a slight over-supply of homes
2 H3 ]; }5 v$ Bpriced over $200,000. Listing periods have increased when compared with 2005,
/ J5 Q. Z' x. N0 ]8 [as some of the pent-up demand that had characterized the market over the last
# w' g# C$ a7 Y4 u. a- K) Ffew years has been satisfied, resulting in more normal, balanced conditions.
1 v# R, j4 l% j7 p" X
$ W" S b, V/ y0 L8 a$ \ Montreal's housing market recorded modest increases in average house7 b! `- y$ w# o- ^4 h
prices, due to a slight seasonal slowdown in the third quarter as inventory' M4 g( T3 S' t4 s, Y# R
levels rose. Part of this can be attributed to the fact that many renting9 h8 b+ @/ ]: u) r+ E
first-time buyers were motivated to close on the purchase of a home by July 1,( }, f! a! H% T9 f8 G# u
when rental leases expire in Quebec. Once this date has passed some of the
) N/ W- G" w% `$ s2 Z5 h, ypressure is taken off the market, allowing buyers to visit more homes before& B% j" f% i" h0 p* e3 s! z
making a purchase.
0 y# H, Y9 N4 F5 r) ~* W! ^ _4 N0 d5 u9 O% ?, {
Ottawa held its position as one of the country's most stable housing; j- B; `1 `" Z9 Y# [
markets in the third quarter, reinforced by a vibrant local economy and strong( e6 q% R2 D( f$ b! n1 n
confidence, resulting in modest increases in average house prices. The city
) M- X, j; r6 w1 }centre remained a bright spot in Ottawa, with homes in this area attracting& t9 T' Y& u, t8 n
attention due to their convenient location and proximity to downtown
; v$ p* ^/ d, q1 I6 M4 B& Uamenities.
3 S# s1 h8 m' i G9 N% A$ |. M4 {9 w' [& T4 w9 s. F
The housing market in Toronto sustained healthy activity levels
, T% R j: h s) @0 zthroughout the third quarter, as a strong economy helped to maintain demand
3 Q# R E8 ?) P2 {4 D% M/ Dacross the city, causing average house prices to rise moderately. Toronto has
$ B4 @: b# D# R6 ucontinued to experience modest growth in average house prices, and has been9 S- ?/ B4 M& v5 i$ S5 w
driven primarily by purchasers who are buying homes as their principle* L( e( X0 o7 d$ c) a2 g+ b
residence, rather than for investment.
: U' P% P. ?& a' {
% p/ z: e- ^* X4 M( S The vibrant Winnipeg housing market continued to show its strength as( e7 o- t. t0 o( X8 T
house prices rose during the third quarter. The booming local economy resulted2 G) f) x) S0 I( [! @/ f
in a historically low unemployment rate, helping to bolster consumer! E8 s8 |! W9 S/ b1 x
confidence and Winnipeg's ranking as the city with the lowest capitalization
0 H% R* e0 q1 Y2 ]' z: T& Krate among the country's larger cities - helped to encourage buyers to enter2 r8 Z9 s1 s$ s0 [& u
the market.
4 {. B, S. I& {6 g8 U) \: C3 { X* ^4 f+ N
In Regina, the market experienced a slight seasonal slowdown through1 Z5 j1 }* E: F( `
July, as there were fewer purchasers in the market due to summer vacations. In: p# b" }( Z) [6 _+ K
August, activity resumed to the busy pace previously seen in the spring
- e/ q1 b1 J3 L8 @$ l$ {- @ l( imonths, as the influx of purchasers made it more difficult to find a home due1 L/ I ] f% I, T- z
to the shortage of available inventory.2 Q' O+ N6 p- U z$ c& S
: }1 R4 o4 ^! H) V Activity in Saskatoon remained brisk as the market maintained its
& I- b" G1 [* k& X" U# xmomentum from the busy spring sales period. The economy in Saskatoon remains
9 f# b9 Q/ ~) ^# l& E; F) yvibrant, as employment opportunities are abundant with many businesses
* U2 `% v7 f, Rstruggling to make hires and having to recruit outside the province.: v3 a- z z: k- C& D, ]/ I' D' Z- ]
/ q0 N$ u" O! v6 z- C
Calgary's housing market recorded blazing average house price increases
1 E, ]0 P) V2 @( E( O! min the third quarter, in all surveyed categories. The burgeoning economy, low; p9 |& b/ x; a9 R9 w
unemployment rates and low inventory levels remained the leading factors that
7 F& H, A. i! k9 K) cpressured Calgary's house prices upwards. However, regardless of the soaring+ Q6 ^4 u5 t5 a# U1 |; `
prices that characterized the market - even during the typically slower summer
/ x) F8 P: R/ R# [season - it is expected that activity will become slightly more balanced, as
! C0 j* J) x- a# }buyers are becoming more reluctant to participate in the frenetic activity.
$ r! L* b1 X- ^. E: \) r& F: G
+ u6 H1 A6 }% r$ q& y Edmonton's booming local economy continued to thrive in the third quarter
! G+ C# ?( ]1 ]0 yas activity in the oil sands north of the city continued to flourish. Edmonton# j C. g5 q& Y% \( H
remained the hub of activity for those coming to work in the oil industry,
6 a" e9 F/ [9 v, T, Omaintaining tight inventory levels across the city, resulting in prices
- [/ c$ i4 h3 ]$ b Z$ h7 G* Pincreasing at record levels. However, as inventory levels continued to improve1 P. C& l' I3 ?# \+ s
in the third quarter the rate of price appreciation should moderate slightly
: Q F; Q4 z! t# h7 O6 x+ U0 [7 _0 u% Ytowards the end of 2006.
6 R( r2 Q5 F2 U, t |+ G- ]
" w2 m) f, a" v: f: D2 sWhile Vancouver has seen a slight reprieve from the severe shortage of
' b( a: r3 S" ?- N' ^inventory that had previously characterized the market, supply is still unable
% V1 T' R4 ] V0 kto meet demand, driving house prices upwards. Vancouver has a very diverse2 G3 z# D+ S- A% g
group of active buyers - from first-time home buyers to baby-boomers to' P! `5 [4 n8 Y$ k1 r* Y5 ?) g
foreign investors - all of whom fuel the demand for houses, placing added
6 w" P& }1 h- Y: G7 Npressure on tight inventory levels.
8 F" y( H& j n& Y% N& W. c
' `/ B8 P+ K# R. G" z Victoria's market is vibrant and supported by strong economic# ~: R" }& T+ ~0 a* x6 E
fundamentals, fuelled by a booming tech sector and a migration of young people
, S/ Z; N* C \6 g- Finto the city that has continued to support the area's house price increases;4 v2 F. T$ @: U3 d
while increased inventory levels have afforded buyers more time when searching
/ y5 e7 @! q% ~' N; T2 ?$ Mfor a home, helping to normalize the market's pace.( u! t+ L$ x; {6 y
& J1 F2 s, w6 J4 C <<# e, g R3 E2 j3 j3 N
Survey of Canadian Average House Prices in the Third Quarter 2006& @" _" N, \, H2 Y
8 J6 {8 x7 z, R2 F+ H+ | ]* ~
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: F j- s; q8 q! _ Detached Bungalows Standard Two Storey
9 E7 X" O+ a9 i6 T -------------------------------------------------------------------------
}7 o: f- f; @* D! t, Z7 J 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
3 U- @$ X S9 n7 g$ c Market Average Average % Change Average Average
) ?" |6 [* V0 ?: q -------------------------------------------------------------------------
! r" _+ M7 K2 C, z: r0 V Halifax 186,333 173,333 7.5% 198,667 199,000
7 D! A+ }, b0 I# w -------------------------------------------------------------------------0 y- y2 N' g/ i9 |0 D3 }9 I; f
Charlottetown 145,000 141,000 2.8% 175,000 170,000
5 Z$ }' w2 _: Q6 Q Q -------------------------------------------------------------------------
3 c L& g5 L& a. S( @ Moncton 135,000 127,000 6.3% 129,000 123,000! F% K' P" Q }+ n$ [/ O9 v/ n
-------------------------------------------------------------------------
: A" f" U7 ?/ j1 O- B% ]1 ? Saint John 141,200 142,900 -1.2% - -
# l/ R+ k2 X4 |5 H F& O( U -------------------------------------------------------------------------5 {9 [0 R! H a) H8 x2 B# i4 \
St. John's 143,667 142,667 0.7% 200,667 202,333
0 j/ w# Q/ G9 W( ]; |' k& c7 T -------------------------------------------------------------------------8 w0 ^( n; c0 _5 o
Atlantic 150,240 145,380 3.3% 175,833 173,583: t* V( f- {& E- _5 T |
-------------------------------------------------------------------------
x; Y4 ]4 ^* G- ~ Montreal 213,691 203,500 5.0% 321,141 316,185
/ T# w2 T( _( L -------------------------------------------------------------------------
$ A, A( k ~. o# l! {8 u Ottawa 290,083 278,417 4.2% 285,667 273,250
K) a/ q/ z# ?% ^) t+ r- M -------------------------------------------------------------------------5 a5 Y! X E$ A0 R
Toronto 373,368 355,882 4.9% 481,523 474,766+ S7 t7 i: Q. H; h4 N6 u
-------------------------------------------------------------------------
4 k& w* a+ }, Y9 f Winnipeg 181,579 159,860 13.6% 202,337 180,707
- O2 d; G. Y& N2 t ------------------------------------------------------------------------- K" ^% R0 R0 c& R
Saskatchewan 170,667 156,083 9.3% 182,600 166,500
# `! u, y. |7 N+ b$ b3 l' D -------------------------------------------------------------------------
' c; P* W7 H$ h a9 o5 k Calgary 395,067 252,411 56.5% 405,778 264,389
3 t3 ?$ u2 U' D/ w) n -------------------------------------------------------------------------
5 c5 I# |. o0 l4 f5 b Edmonton 286,857 194,857 47.2% 316,429 206,714
0 F' V5 f, D# V8 w -------------------------------------------------------------------------. p7 @' Z# J3 M- p$ G- [' x2 \# w: o
Vancouver 704,250 601,000 17.2% 794,000 697,500
" p* G9 g' e6 O/ O, B -------------------------------------------------------------------------9 l2 h1 M/ Y+ f* `3 g
Victoria 375,000 348,000 7.8% 403,000 391,000
6 ^$ `+ l0 ?# w1 A9 N% A -------------------------------------------------------------------------. T/ j* U3 G% {: e9 V: a
National 300,365 258,202 16.3% 365,380 322,860
, f# N5 l0 g3 e -------------------------------------------------------------------------
; j3 h6 _ I5 K1 {+ `3 S0 p1 l1 `
) F1 u S6 k% I. u, b$ K- L, n -------------------------------------------------------------7 b9 | l: ` C( Z. Q
Standard Condominium
1 C! p$ ?" X9 x s -------------------------------------------------------------, S! H' q O8 f6 [ N- C0 w$ h
2-Storey 2006 Q3 2005 Q3 Condo
4 G5 K2 u: `! L( I( t: X) X Market % Change Average Average % Change
2 q: k/ P, T! [) T -------------------------------------------------------------6 ^1 x, c. v1 q7 e6 F( b& N0 e. T
Halifax -0.2% 142,000 103,000 37.9%
3 T# g$ k: I* T -------------------------------------------------------------
7 D" S2 T% y' }+ u6 }) T1 z6 ` Charlottetown 2.9% 98,000 98,000 0.0%
: l+ k; i9 ^: Q( L) ~# t -------------------------------------------------------------
3 }+ I' V6 ]- ]0 l3 D" z' y Moncton 4.9% - - N/A! h: t- z; s5 W$ P8 c1 P
-------------------------------------------------------------7 \" H& ~ ?% u9 q8 |5 e* j
Saint John N/A - - N/A) H* @6 C/ X" ?4 W' C( ^
------------------------------------------------------------- y; d( |9 O" E
St. John's -0.8% 146,333 145,667 0.5%
0 m4 \) O+ b1 C6 h+ Z+ Q' T -------------------------------------------------------------7 A; k8 |( S9 u% t' u
Atlantic 1.3% 128,778 115,556 11.4%1 z0 \6 L) p, C1 r4 {
------------------------------------------------------------- w. T; B6 l$ Y& |' B
Montreal 1.6% 193,190 188,016 2.8%
; u; b7 X4 l9 [! R6 M -------------------------------------------------------------9 V* N6 F2 G4 W( M
Ottawa 4.5% 181,083 172,250 5.1%
$ {' S8 R0 I5 J -------------------------------------------------------------
0 d% e3 s9 X1 r+ U; n( k, v5 C( a Toronto 1.4% 252,088 242,918 3.8%
& H# t+ F6 R/ A$ A1 j -------------------------------------------------------------7 u3 U6 ~- s$ o) v6 x0 E
Winnipeg 12.0% 105,648 96,008 10.0%
% d# S* I* z3 K$ u) N2 L6 U4 h -------------------------------------------------------------! B. E- Z& h3 o7 [7 ?
Saskatchewan 9.7% 106,250 101,000 5.2%
& h1 t/ v( m% u, k, Q -------------------------------------------------------------" _4 K$ d- n; x$ Z6 X
Calgary 53.5% 245,844 153,867 59.8%. F' P, r2 h4 y* b0 ~
-------------------------------------------------------------5 [' N; c# ^8 z( J7 G' b R3 Q7 h
Edmonton 53.1% 200,433 131,500 52.4%( F7 Z+ l( w( A5 h9 w' g0 h+ r
-------------------------------------------------------------
8 }5 N! N$ @, V1 I Vancouver 13.8% 366,250 323,250 13.3%% R% F8 b( B% L+ X+ U
-------------------------------------------------------------
. |# U4 {, f* o0 L: z Victoria 3.1% 229,000 220,000 4.1%
V; N- C0 A- k0 n% Q3 Z4 U, H) l -------------------------------------------------------------
! w9 H$ k% R& z National 13.2% 211,562 185,296 14.2%9 [* {8 r2 B- t8 N" X: I" z3 v' [: w
-------------------------------------------------------------; J! Y. y1 h* j/ F+ g7 b9 d
>>
' d+ Y. j( G$ W5 C" d' g6 J; b. y$ _
Average house prices are based on an average of all sub-markets examined1 S9 ~) Y# s/ Q. v5 ]
in the area, except for the smaller markets of Charlottetown, Moncton, Saint
" O% n- J- k6 G' l7 H+ F' eJohn and Victoria.
/ R/ O* V/ F. E; F
" o' n8 C( T! V+ Z+ l2 {4 r The Royal LePage Survey of Canadian House Prices is the largest, most
i$ I* J, l$ G0 P# ~; gcomprehensive study of its kind in Canada, with information on seven types of
/ b& _! M) H3 d' m' n7 phousing in over 250 neighbourhoods from coast to coast. This release
" g/ @3 A/ U0 Y5 Z5 rreferences an abbreviated version of the survey, which highlights house price2 g! h* e) x% [- P& C$ |
trends for the three most common types of housing in Canada in 80 communities
; _5 ~6 m" F7 p; {7 l' I5 Kacross the country. A complete database of past and present surveys is K$ _' h6 @) X' l5 z/ I/ }
available on the Royal LePage Web site at www.royallepage.ca, and current
- Y* F: {$ E3 L+ _" ifigures will be updated following the end of the third quarter. A printable
% j: C( f: n9 l" n- D. Fversion of the third quarter 2006 survey will be available online on, q- x6 M o0 A, ?2 J( c
November 15, 2006.
7 m* m2 g/ }& O3 }0 F: } Housing values in the Royal LePage Survey are Royal LePage opinions of
' N$ b; X( h y: `fair market value in each location, based on local data and market knowledge
2 y+ j& ?) H2 g3 v: @provided by Royal LePage residential real estate experts. Historical data is
4 F+ e/ `- q* p. T/ B6 uavailable for some areas back to the early 1970s. |
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