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Canada's housing market both vigorous and stable 1 Q- P. C% T; V. L* G; c
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- Country's market poised to show growth throughout 2006 -
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TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
T$ Q& v2 Q6 ^# |" _exhibited moderate price increases and stable unit sales during the third
; Q& k( D5 e0 q2 Kquarter. Wide regional variances continued to be the dominant characteristic
- J$ m: C& m4 _5 a4 n% }in the market, exemplified by frenzied levels of activity and double digit9 O( ?* [- ~+ D8 C; d% H$ V3 i
price gains observed in the energy and commodity rich Western provinces, and
2 M* W$ v9 Q, V% zmore reasonable sales volumes and moderate price appreciation in Ontario,& g9 s8 p& @8 Z) J/ s0 v+ I* n
Quebec and Atlantic Canada, according to a report released today by Royal3 I! K" J) C3 y3 O- }
LePage Real Estate Services.
9 U$ o5 Y; l2 E1 q; K/ v
: \/ M9 ?% h1 y4 X% N0 l5 H# g Nationally, market trends established through the first three quarters
+ d: R4 E# i& pare forecast to continue for the remainder of the year. Robust economic
2 |2 L; G/ Y, xconditions, low unemployment rates, modestly growing salaries and wages, and
$ M, [% g. i8 O% Q' W+ wsound consumer confidence contributed to the overall strength of the+ k( q1 t' Z- K) r4 P4 Y
residential real estate sector.
& S: N# ^* B7 D2 `7 V- E- _. H$ y( ^0 U' f, O4 f s; p( J
Of the housing types surveyed, the highest average price appreciation% P# L0 ~% O8 X; f# j% z
occurred in detached bungalows, which rose to $300,365 (+16.3%): _% A- f; j- w/ W# N% l0 T0 A
year-over-year, followed by standard condominiums, which rose to $211,562
6 j( R, E9 m8 r" M4 q2 l(+14.2%), and standard two-storey properties, which increased to $365,3807 J, O$ M" g0 x: V/ w# V$ C* N
(+13.2%).
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"Canada's sturdy housing market continued to demonstrate steady growth
. y8 d5 K+ {- cduring the third quarter. For all but the west, we have moved on from the. [* `2 a, c) h
frenzied expansion that characterized the first half of this decade, and are
. K/ n3 Y' e2 j5 r" G( m6 h& Spoised to show continued growth at a more moderate pace," said Phil Soper,
# p. Q; {# C; |( \. D5 c$ f4 ipresident and chief executive officer, Royal LePage Real Estate Services.8 w8 f) @/ m6 L- ^+ L) k
"Gone is the sellers' market that we have lived with for some years. We
8 u: V, S4 p& R w( w3 uwelcome the more reliable conditions that are characteristic of a healthy
3 k3 `+ I1 h7 u9 [* P0 F5 n# B+ \/ ebalanced market."
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Despite the double-digit rise in average national house prices,
8 B) A4 i( c( w) D* Pconsiderable regional variances were exhibited again this quarter. The shift* S) Y) H& e# m
to balanced market conditions, which began in late 2005, has continued [* Z7 N( f+ _. c# R' _
throughout most of the Central and Eastern regions of the country. In the core
) }5 ^0 P7 n2 Z2 J. Tenergy producing western provinces, the combination of very high in-migration,
# ~0 Y. h4 s6 `! Omanageable affordability, and a shortage of inventory has driven record/ ~$ b) Y7 Y8 G) k& @
breaking price appreciations.
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) r, |, B N4 F: g: j5 C: m) ~ Echoing the second quarter and supported by Alberta's rapidly expanding
$ z. s; C7 E" _& \9 ieconomy, Calgary and Edmonton led the charge of Canadian cities with the
9 E9 I5 R* [( b) l0 `, plargest house price appreciation in all housing types surveyed.0 j y9 q7 Y+ R% K: D) L& `
' b V5 M7 g7 Y In Ottawa and Toronto, growth remained steady, supported by solid$ D$ `; R) }. x3 h: D; F4 e5 D
economic fundamentals, an increase in available inventory and strong consumer
6 \' |* z/ b! n) p: ^4 m, l' Kconfidence. While the pace of price appreciation in Ontario leveled off9 l; j; Y% j. m8 j1 e
slightly, the province's real estate market remains poised for modest growth.* u8 `0 A ~5 W
In Atlantic Canada, new housing and condominium construction offered buyers
4 J, {- r" v! ^9 o7 D/ E8 Z3 {greater selection at more competitive prices, resulting in a slower rate of
8 ^1 A: Q; S4 J* }& tprice appreciation when compared with 2005.
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While the pace of growth in Canada has slowed, the domestic housing
/ B0 k0 ?4 F' K# Jmarket is expected to outperform the American market. The economic and
# T* ]# h1 j1 }/ `5 K. P2 B. _1 p3 tfinancial fundamentals driving the residential real estate sector in Canada
+ T& {- W( e; u6 y5 Fare markedly different than those found in the United States.9 c6 J8 l4 k+ B" f& K, K
( L. b* Y3 I: a: I, i3 @% O2 k: T& t Added Soper: "Canada's housing market is likely to outperform the" `! `+ C" f9 u. m- Q: \8 d+ O: A7 K
American market through 2007. A number of factors are working in Canada's- X7 a+ t# s# w3 d1 l! |* E! {1 i
favour, including healthy personal and governmental debt levels, the
7 B' k0 { t c. u- g& v' k) \9 ]relatively modest rise in interest rates in our country, and general
7 C% z8 c* E3 t& Oaffordability in our major cities. In addition, Americans are now seeing the/ f/ Y2 n, Y A( F- @
downside of a tax system that encourages maximum homeowner leverage, and2 a1 Z7 ` R0 m
aggressive financial products such as zero- and negative-amortization; G" u6 s2 z8 O6 F
mortgages that work only in a high price growth environment."4 P$ ]/ n/ Q0 y/ a
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0 {. l) k6 Y, }: |/ E REGIONAL SUMMARIES0 n2 y. P" Z7 n9 ], e$ @
>>
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4 M4 L0 x( y: x) u# |! @ Balanced conditions continued to characterize the housing market in; u. U% H9 \6 Y2 B
Halifax, as significantly higher inventory levels helped to moderate the rate
, i/ e* v' b- v7 i4 y- dof price appreciation. Buyers were increasingly choosy, taking more time
. P5 V1 M/ I( X# H+ H- E- W7 Tlooking for newer, low-maintenance properties that were not in need of
% ^$ C( j$ w' v1 m3 Q- Crenovations. w5 c8 p { M/ F h k6 K$ T/ Y @$ _
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The housing market in Moncton remained healthy and strong as a slight
# F3 {/ E5 d7 m6 y4 lincrease in inventory helped to moderate the rate of price appreciation+ _% b+ h9 p. C8 P+ b4 P( p
compared to the same period in 2005. Activity was brisk throughout August and' ^2 U3 L- L$ ]8 y* E
September and is expected to remain this way through the fourth quarter.
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The housing market in Saint John underwent its traditional summer
6 v5 i+ z6 B- k' `+ J5 a+ S. cslowdown in the third quarter, with activity picking up towards the end of the4 {; H w; P1 Z# {
quarter. The local economy continued to thrive, as construction on a new K4 M% O# h5 o0 p
600,000 square-foot shopping area has begun, bringing several new box stores$ }- E/ P* U7 |4 \
to the area. Buyers have begun seeking less expensive fixtures for their homes
) @6 i( y) v, y0 L4 {and are instead opting for more affordable housing options.
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! P0 C4 Y' P3 ~9 x" l In Charlottetown, the housing market started to move towards balanced% G z+ P0 X2 u4 a
conditions, as some sellers had to begin to lower the asking prices on their: t! C8 v: j" w5 |6 z, l
homes to make them more competitive. Activity from out-of-town and US buyers( U2 y$ V$ T% k0 z- ?! j% K
was down slightly compared to 2005, likely attributable to the strong Canadian, I+ m O6 g- z
dollar. Inventory levels began to creep up in the third quarter, providing
0 X6 i* j* y1 E- N: s- jbuyers with more options when looking for a home.
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Activity in St. John's slowed slightly in the third quarter, particularly
0 X% E0 }% [0 m9 a) n+ B4 R3 Bamong higher-priced properties, where there was a slight over-supply of homes) G$ i% O' z9 _0 l5 ~
priced over $200,000. Listing periods have increased when compared with 2005,# G# c9 R, H# U% H+ g
as some of the pent-up demand that had characterized the market over the last
' Y- ]8 f/ P+ jfew years has been satisfied, resulting in more normal, balanced conditions.; }+ ]3 k6 a6 \3 f3 {9 \# S+ N4 \& S
, A6 C' s& w5 r( \/ a. G Montreal's housing market recorded modest increases in average house
4 C' @$ ]/ W7 o$ h6 p! ~8 Cprices, due to a slight seasonal slowdown in the third quarter as inventory2 @4 O. U2 g1 J
levels rose. Part of this can be attributed to the fact that many renting
% ?# O d: D8 [! S( n( R1 c: a! |, N& Ffirst-time buyers were motivated to close on the purchase of a home by July 1,
9 p; A) _) Z9 F- J6 x, b$ bwhen rental leases expire in Quebec. Once this date has passed some of the
8 C: m0 w; m6 k& n. a: @: Y* C; rpressure is taken off the market, allowing buyers to visit more homes before' R& c4 V Z2 j! F M, q/ F/ C
making a purchase.7 d, D" N9 O/ v. B5 P7 ~
9 [3 p: G' `/ F1 |6 b Ottawa held its position as one of the country's most stable housing
+ H: F( B) ]9 @6 J6 tmarkets in the third quarter, reinforced by a vibrant local economy and strong
# Q/ v, O) H: F k0 k! ?- Aconfidence, resulting in modest increases in average house prices. The city
9 A \. O R3 ~% _- Q/ Ecentre remained a bright spot in Ottawa, with homes in this area attracting. }; L/ Q' R+ S: ?2 E% _ N& l
attention due to their convenient location and proximity to downtown
. \+ N4 q* Y2 Tamenities.0 i4 T" K* {: o( x, z
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The housing market in Toronto sustained healthy activity levels
4 S+ @% c! g" [6 ?- sthroughout the third quarter, as a strong economy helped to maintain demand
0 n+ `! s* O% E5 \ ^6 W; Oacross the city, causing average house prices to rise moderately. Toronto has/ Y6 j/ f7 i8 ?7 Z
continued to experience modest growth in average house prices, and has been, V; |& d' T' q( u
driven primarily by purchasers who are buying homes as their principle
: B! P9 h: u$ V9 fresidence, rather than for investment.5 E7 U& v, C7 A7 n9 t
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The vibrant Winnipeg housing market continued to show its strength as
, H7 P' L, p6 d/ u g1 X% m" ^ h% ohouse prices rose during the third quarter. The booming local economy resulted
( K" s' {, f/ a. M* l2 f: n9 F4 Qin a historically low unemployment rate, helping to bolster consumer( q0 z1 h' x4 G
confidence and Winnipeg's ranking as the city with the lowest capitalization
7 [8 \1 C4 K! \7 Crate among the country's larger cities - helped to encourage buyers to enter" u ]9 o8 L/ E, }' [- a5 S
the market.
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In Regina, the market experienced a slight seasonal slowdown through
2 H7 ~. K0 o1 I* o& P* ^July, as there were fewer purchasers in the market due to summer vacations. In
, c" w9 o/ U/ p$ @5 x0 cAugust, activity resumed to the busy pace previously seen in the spring
2 ]( R% Q; g% Gmonths, as the influx of purchasers made it more difficult to find a home due1 {- B3 g! f' J4 \2 H! x. s
to the shortage of available inventory.
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' N# R; M* u3 ~ Activity in Saskatoon remained brisk as the market maintained its, ?0 f1 b' O; l/ ^: C7 t' Y' m
momentum from the busy spring sales period. The economy in Saskatoon remains1 V3 d5 L! g) j$ w$ w
vibrant, as employment opportunities are abundant with many businesses
' E3 M2 U8 ^" ~4 istruggling to make hires and having to recruit outside the province.
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Calgary's housing market recorded blazing average house price increases
. i2 V" @( F; S$ m. jin the third quarter, in all surveyed categories. The burgeoning economy, low+ ~+ r/ R+ h+ A! I8 ?
unemployment rates and low inventory levels remained the leading factors that' ?! H; R5 t! m6 I7 p; U+ C& w
pressured Calgary's house prices upwards. However, regardless of the soaring2 Q0 G m5 o6 q1 U
prices that characterized the market - even during the typically slower summer, Y4 |4 M- I' N! O
season - it is expected that activity will become slightly more balanced, as
% H7 ~- V+ i6 H, I& D# abuyers are becoming more reluctant to participate in the frenetic activity.
) U$ k6 W G0 v8 u/ C. y& f' ~& H" Y; j4 D1 w! l0 F/ o2 r' O
Edmonton's booming local economy continued to thrive in the third quarter5 {* K/ g( t+ m
as activity in the oil sands north of the city continued to flourish. Edmonton
( \0 K% v& b4 e) c6 p1 }% \remained the hub of activity for those coming to work in the oil industry,- a; E& L8 u& b0 P6 a# P$ P
maintaining tight inventory levels across the city, resulting in prices3 e1 X! Y# r* i- M6 F3 r
increasing at record levels. However, as inventory levels continued to improve
# C# {; G# R- e7 E/ _* H. e3 k+ Iin the third quarter the rate of price appreciation should moderate slightly
1 Y% e6 v, D! Ttowards the end of 2006.
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While Vancouver has seen a slight reprieve from the severe shortage of# Q1 K+ L8 ~ e: I
inventory that had previously characterized the market, supply is still unable& Q4 H1 c# s' x6 K# w0 \% x
to meet demand, driving house prices upwards. Vancouver has a very diverse
! E: v1 \% P) S: O6 k- u w9 pgroup of active buyers - from first-time home buyers to baby-boomers to/ ]- Q a# x& Z1 O# c
foreign investors - all of whom fuel the demand for houses, placing added
& _/ f ^' s/ r7 `7 kpressure on tight inventory levels.
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Z) i! A& |; I7 ?" } Victoria's market is vibrant and supported by strong economic9 y f, v" G. f/ y+ c
fundamentals, fuelled by a booming tech sector and a migration of young people
, f7 f: U- \* xinto the city that has continued to support the area's house price increases;' X3 x* Z/ T& s* q
while increased inventory levels have afforded buyers more time when searching
/ f3 U' I S; f: {/ T! Y& D' ?for a home, helping to normalize the market's pace.
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Survey of Canadian Average House Prices in the Third Quarter 20061 X, _9 q5 \' c g- `
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-------------------------------------------------------------------------: D/ ~4 m1 t3 y3 P
Detached Bungalows Standard Two Storey
8 } }! a& D7 @: z1 { -------------------------------------------------------------------------+ w7 q% ^6 R: ]7 W8 U
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
) M) m8 Y. p6 h& m) z Market Average Average % Change Average Average
8 |0 M9 R0 ?$ o y8 ?8 j7 d -------------------------------------------------------------------------
$ I; G! d/ R& D8 E7 H Halifax 186,333 173,333 7.5% 198,667 199,000
2 i9 O' Q" C" c -------------------------------------------------------------------------# z8 I& E9 m( N% l9 U
Charlottetown 145,000 141,000 2.8% 175,000 170,000
2 ?# C" N9 \- P8 K( A' l4 i -------------------------------------------------------------------------
3 d+ \$ z" L% {$ T Moncton 135,000 127,000 6.3% 129,000 123,000! g& F ?9 |( M8 Q7 z* R& N
-------------------------------------------------------------------------% A: u3 [( O+ L
Saint John 141,200 142,900 -1.2% - -6 R3 K. E f6 B0 F: E" r$ v
-------------------------------------------------------------------------, M$ t6 v1 k- Z% q7 H1 K7 g
St. John's 143,667 142,667 0.7% 200,667 202,333, Z4 W) W: J" m! W" g( ?4 c
-------------------------------------------------------------------------4 s h3 U% v, F. U" j
Atlantic 150,240 145,380 3.3% 175,833 173,583# A w* p1 }" F
-------------------------------------------------------------------------
0 K3 q# E8 u* y) r$ S7 m1 r Montreal 213,691 203,500 5.0% 321,141 316,1850 z9 [$ V" B; U/ w
-------------------------------------------------------------------------
( q. Z$ \5 F: a; q; M! m Ottawa 290,083 278,417 4.2% 285,667 273,250
+ ~: ~: Y; _4 x; z -------------------------------------------------------------------------
+ O) W' S$ F" a6 c9 e8 R7 F6 o* z3 A Toronto 373,368 355,882 4.9% 481,523 474,766
A M s: V9 Y7 I: B8 a -------------------------------------------------------------------------
; b" i7 t7 \2 }! u Winnipeg 181,579 159,860 13.6% 202,337 180,707
" k6 g9 c" z8 g9 x, q) z0 O -------------------------------------------------------------------------! K( J/ t. Z4 a6 a( P
Saskatchewan 170,667 156,083 9.3% 182,600 166,500
7 m+ L' \; X; I) z, n -------------------------------------------------------------------------
( Q: S2 w( a& E! \ Calgary 395,067 252,411 56.5% 405,778 264,389
, t/ d$ h3 } _3 A$ g8 w -------------------------------------------------------------------------' |# j$ z! e" c- Q5 c7 ^+ c3 v
Edmonton 286,857 194,857 47.2% 316,429 206,7146 U3 k# L3 |( q1 U, z. [
-------------------------------------------------------------------------# r, a# S, f1 @, u1 e% S! b
Vancouver 704,250 601,000 17.2% 794,000 697,500
4 w3 V E/ g- i3 |1 z -------------------------------------------------------------------------
0 A* B2 n; f- B0 L% g Victoria 375,000 348,000 7.8% 403,000 391,0002 e8 f) f/ |/ C: @/ f
-------------------------------------------------------------------------
( a. T) J- w3 N7 U/ ^/ X National 300,365 258,202 16.3% 365,380 322,8601 j& W8 e' d* h1 X% j: c7 r6 A1 R4 {
-------------------------------------------------------------------------
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6 Y* T/ X Z k; V -------------------------------------------------------------7 n: n3 i3 f$ q4 t. f" M- g+ z' w8 K
Standard Condominium7 O. O! s# g" a7 g0 y+ x
-------------------------------------------------------------! O4 G$ u1 G$ A" T0 ^- I& \5 i
2-Storey 2006 Q3 2005 Q3 Condo
4 z4 c' [8 w* R+ f1 {0 M$ U Market % Change Average Average % Change
& U2 x6 J H- o4 V5 i -------------------------------------------------------------
6 W7 v* v6 |7 b Halifax -0.2% 142,000 103,000 37.9%& M. K1 F# P5 {+ r! ]
-------------------------------------------------------------9 c' n Q: { `: v8 @: o
Charlottetown 2.9% 98,000 98,000 0.0%! P& D9 }! O* a1 T4 T% [
-------------------------------------------------------------$ i7 S+ a$ Q4 I I; \! I% ]
Moncton 4.9% - - N/A
3 u0 F/ A. T5 d -------------------------------------------------------------
$ K* e! Y" h8 t/ t& o Saint John N/A - - N/A
; w+ F, C, T- B2 B' E: o' I -------------------------------------------------------------
6 [1 z- N- G2 @1 c, L St. John's -0.8% 146,333 145,667 0.5%
$ |1 s3 {) _( p( ? -------------------------------------------------------------
9 ~! n; q% G9 _& Z! U0 q Atlantic 1.3% 128,778 115,556 11.4%8 G6 \, e$ O# O
-------------------------------------------------------------
% T7 h( c% Z3 l/ e2 f Montreal 1.6% 193,190 188,016 2.8%" h9 S& ?* i/ i$ y( s1 l; o: N
-------------------------------------------------------------
+ b- }# D0 \5 `3 x Ottawa 4.5% 181,083 172,250 5.1%
: r8 e# I7 }1 D. ?7 w -------------------------------------------------------------
) P( c" }4 o; S+ } Toronto 1.4% 252,088 242,918 3.8%) m- e7 l& j M H& H8 M
-------------------------------------------------------------8 e) n8 }1 W9 D! h; k" b( Z
Winnipeg 12.0% 105,648 96,008 10.0%5 S, \8 p* C# G$ E4 D
-------------------------------------------------------------5 L+ i! C1 o- l4 {( d
Saskatchewan 9.7% 106,250 101,000 5.2%
7 v) v3 u& q/ T$ x -------------------------------------------------------------# R3 u. q6 P; v& U0 u
Calgary 53.5% 245,844 153,867 59.8%& J, g, w" `4 n/ E* j1 P0 }
-------------------------------------------------------------" I4 H; N9 D/ l7 O( W8 d; P5 z7 X
Edmonton 53.1% 200,433 131,500 52.4%# [! U1 A; t1 s E$ B3 j
-------------------------------------------------------------; K2 a9 M3 L- |5 {
Vancouver 13.8% 366,250 323,250 13.3%
$ ]0 i7 W8 v( Y( w$ A -------------------------------------------------------------
- `( t U! I% v2 j! w0 Q: M v Victoria 3.1% 229,000 220,000 4.1%
! a5 u5 M2 I- U -------------------------------------------------------------1 K+ p) V# S/ j" B) a4 g
National 13.2% 211,562 185,296 14.2%
" U* |6 K- ]2 P0 b' P -------------------------------------------------------------
7 j. p+ {; ^' N7 r# S/ J >># I* Y) i# g8 V) x
, J% Q. Z. `3 I6 I( h: W6 ^
Average house prices are based on an average of all sub-markets examined
: v) b2 c e0 N6 B! a6 y2 Yin the area, except for the smaller markets of Charlottetown, Moncton, Saint
. p' e+ m! g: |9 F' _John and Victoria.2 L& N9 w8 w9 S; K! _( G, }6 {
! t1 P/ u& T0 p The Royal LePage Survey of Canadian House Prices is the largest, most
) P6 v- q& }1 v+ Z1 {( scomprehensive study of its kind in Canada, with information on seven types of8 R1 [1 r$ e. I
housing in over 250 neighbourhoods from coast to coast. This release% Z3 d" y3 u, G' ]# l5 _; ~0 y
references an abbreviated version of the survey, which highlights house price* C7 h7 a2 X1 G' A$ B$ H
trends for the three most common types of housing in Canada in 80 communities
! ]$ \. ]; L0 e; Z1 y: Lacross the country. A complete database of past and present surveys is' F$ M+ o9 l& h: S& d4 d
available on the Royal LePage Web site at www.royallepage.ca, and current; {& j, c1 p; B P: t
figures will be updated following the end of the third quarter. A printable5 ?1 K6 _) n% Y( b5 g* F u
version of the third quarter 2006 survey will be available online on
6 [' X7 x G; S+ U/ Z* ~November 15, 2006.
% G8 Q2 h; k) Q1 c# F* x Housing values in the Royal LePage Survey are Royal LePage opinions of+ \* F4 _, i) w1 H, B# p
fair market value in each location, based on local data and market knowledge8 s4 m1 g) J5 i0 z' L$ H6 e5 e
provided by Royal LePage residential real estate experts. Historical data is5 I A& `- |3 z* }/ z, T
available for some areas back to the early 1970s. |
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