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Canada's housing market both vigorous and stable
) U1 T8 @ K x* F
3 T6 }# \! m: T" r- Country's market poised to show growth throughout 2006 -: a# }4 b L" z3 @) l- N9 O6 z* H. @
( k2 j& B: n6 U7 C4 U TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
. ?' Y/ M8 @/ B2 zexhibited moderate price increases and stable unit sales during the third
) ]* H7 |2 a( g. r3 u7 Jquarter. Wide regional variances continued to be the dominant characteristic' O8 ~) k4 h8 I L3 M$ G s
in the market, exemplified by frenzied levels of activity and double digit) y3 D* @. y: W
price gains observed in the energy and commodity rich Western provinces, and+ n" o6 |( M8 R. U5 |3 K
more reasonable sales volumes and moderate price appreciation in Ontario, ?& Q* z! C6 ?
Quebec and Atlantic Canada, according to a report released today by Royal0 m; X- }. j2 S6 t
LePage Real Estate Services.
' ~) U/ I7 c4 v3 l: ^
1 e6 j% w- h" p/ G& H/ S, J) i Nationally, market trends established through the first three quarters
( S6 _/ k0 j# [& rare forecast to continue for the remainder of the year. Robust economic
$ N% _- O3 \! ~* C( Q- j6 gconditions, low unemployment rates, modestly growing salaries and wages, and
3 c7 ?: ~( j. u* P8 h+ V' Hsound consumer confidence contributed to the overall strength of the
9 b% r! ?1 e; ]7 w. Rresidential real estate sector.3 Z+ H: a1 e; B6 y* o% L* c9 Y
" v: `4 @! l% S+ C/ |! Y+ A
Of the housing types surveyed, the highest average price appreciation) n9 ?: J+ z) m+ d9 R, e p! u
occurred in detached bungalows, which rose to $300,365 (+16.3%)
- K8 b- ~7 J* M3 K5 {& E" D. cyear-over-year, followed by standard condominiums, which rose to $211,5629 s/ `+ W& V& E4 w
(+14.2%), and standard two-storey properties, which increased to $365,3800 ]7 R9 R7 r/ b r/ `+ o( N
(+13.2%).
6 B) r2 i2 P! Q: ^: ]/ t' x- K# l e. ^% o% {* N5 }' ]% T
"Canada's sturdy housing market continued to demonstrate steady growth
- G8 {; _( p) O, Cduring the third quarter. For all but the west, we have moved on from the" w5 [4 r+ x5 b0 q5 h
frenzied expansion that characterized the first half of this decade, and are
$ K m0 |6 Q2 S/ Jpoised to show continued growth at a more moderate pace," said Phil Soper,1 R! F! ]3 b8 w+ A1 }: u2 C
president and chief executive officer, Royal LePage Real Estate Services.' {' n$ H# }+ a& V, K
"Gone is the sellers' market that we have lived with for some years. We
5 X: h W5 j+ O9 Y6 ]. s% b- Mwelcome the more reliable conditions that are characteristic of a healthy
. {- r* D$ u% c% _balanced market."
5 k2 a U; b- c+ C: C! J
: j. r1 |; C! K. k9 l+ N5 x Despite the double-digit rise in average national house prices,
4 _# S, _6 T) ~; F1 Mconsiderable regional variances were exhibited again this quarter. The shift7 Z* f9 q, @: l- [# ?7 X
to balanced market conditions, which began in late 2005, has continued1 ? n, F! a( f% ` C+ I
throughout most of the Central and Eastern regions of the country. In the core
6 X( I! m3 G, Y; |" Kenergy producing western provinces, the combination of very high in-migration,
- `5 S! Z: _7 r5 @. L: B3 ~& H( Wmanageable affordability, and a shortage of inventory has driven record3 D! q3 a, y7 S- b
breaking price appreciations.
2 k6 V3 z/ G+ @. Z# B2 }- h' x7 S* H5 A
Echoing the second quarter and supported by Alberta's rapidly expanding, ?% e! d; J h
economy, Calgary and Edmonton led the charge of Canadian cities with the
" w1 l/ ?5 C9 N9 T. Y1 ~largest house price appreciation in all housing types surveyed.
: f+ w; p# C/ ^5 l
8 u6 r( I( { A$ B, V6 Z In Ottawa and Toronto, growth remained steady, supported by solid
+ J* F: }5 I5 J# k& ~. i3 d G1 heconomic fundamentals, an increase in available inventory and strong consumer
8 P( g# y1 f, d- h! ^! H7 Wconfidence. While the pace of price appreciation in Ontario leveled off/ U6 j7 L2 ^; p. Q5 [
slightly, the province's real estate market remains poised for modest growth./ a0 I' x6 W5 ^! K" r; x
In Atlantic Canada, new housing and condominium construction offered buyers) B% y" U0 P$ \& F
greater selection at more competitive prices, resulting in a slower rate of/ \) A' I' L- y2 Q9 k8 y
price appreciation when compared with 2005./ ]4 m, q5 ]1 `
% u& D8 E& b9 G( F! q
While the pace of growth in Canada has slowed, the domestic housing
, l; {# ?* N$ D- }/ H7 N2 ?' S) _) fmarket is expected to outperform the American market. The economic and
9 m! W7 }, J# @1 L6 p* B' yfinancial fundamentals driving the residential real estate sector in Canada
0 V8 E! Y1 z/ f3 f! Pare markedly different than those found in the United States.
; {8 @% D0 F+ @( w: m
( r7 k9 N7 P& @2 v1 R' n7 `$ @ Added Soper: "Canada's housing market is likely to outperform the# x% M4 k8 G1 ]
American market through 2007. A number of factors are working in Canada's
0 d6 M2 R5 X; w$ x3 o- Afavour, including healthy personal and governmental debt levels, the
) D8 {) F7 o" B! L: Srelatively modest rise in interest rates in our country, and general: i" Y% D/ ?6 r# N8 c
affordability in our major cities. In addition, Americans are now seeing the$ |% y% j) o5 f% l, i
downside of a tax system that encourages maximum homeowner leverage, and5 b; H! B; {1 ]6 n
aggressive financial products such as zero- and negative-amortization
" K% O( ^5 z8 M! S9 L$ omortgages that work only in a high price growth environment."9 o( V9 A( z) w$ ?; w6 w" I
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<<
; L' m1 V3 h# G7 [4 {& q% `% Y; B REGIONAL SUMMARIES4 H1 G0 F% L9 |: z }
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7 E2 J( g0 B5 ]5 P- m Balanced conditions continued to characterize the housing market in
( ~ O. L6 \* t: L1 IHalifax, as significantly higher inventory levels helped to moderate the rate
5 G! l% E! X8 u1 l2 Rof price appreciation. Buyers were increasingly choosy, taking more time) j- t) `5 F0 q; Y( E$ X, ?
looking for newer, low-maintenance properties that were not in need of( \$ V- K* c" u, Y* x" }; |; L5 M
renovations.
* S6 _0 J+ o( s, l
5 E6 ]$ c' K% f1 T n) g The housing market in Moncton remained healthy and strong as a slight
3 s9 W) ? K" f+ [increase in inventory helped to moderate the rate of price appreciation
8 y+ q6 p6 I3 t# P& Bcompared to the same period in 2005. Activity was brisk throughout August and) F- }6 ?( e( R5 n. e4 B, L8 C
September and is expected to remain this way through the fourth quarter.0 H, L4 V0 |& y7 l$ u% Z: z
# o5 g; u* ^' r5 c% Y
The housing market in Saint John underwent its traditional summer
, k0 s8 V! }6 X6 U; B' Gslowdown in the third quarter, with activity picking up towards the end of the/ Z( R5 R* y) ~
quarter. The local economy continued to thrive, as construction on a new
" E0 L# S; r: }4 @7 u" z600,000 square-foot shopping area has begun, bringing several new box stores
% M0 b1 F7 r3 t1 @/ C: ~2 a/ Ato the area. Buyers have begun seeking less expensive fixtures for their homes$ K+ ]& l1 L! R) J% Z
and are instead opting for more affordable housing options.
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In Charlottetown, the housing market started to move towards balanced
8 Z" o5 j* ^% e( |2 Dconditions, as some sellers had to begin to lower the asking prices on their' L) Y9 U, ~& h0 f: p. V
homes to make them more competitive. Activity from out-of-town and US buyers& T) g5 w; W2 \, T
was down slightly compared to 2005, likely attributable to the strong Canadian2 e6 V: w$ i& P7 ]) C
dollar. Inventory levels began to creep up in the third quarter, providing# \7 A& U& t, T4 p. a3 t2 R% S5 R
buyers with more options when looking for a home.2 u3 ]. T s f& t: l* ?
. s/ Z# R* g1 N4 k- Z7 s3 u Activity in St. John's slowed slightly in the third quarter, particularly. h. X6 \ c* ?4 ]9 p
among higher-priced properties, where there was a slight over-supply of homes
+ \& N8 x" W3 t" ?& c& u Ipriced over $200,000. Listing periods have increased when compared with 2005,
/ ~; e. g/ v" M3 F5 E5 E; Zas some of the pent-up demand that had characterized the market over the last
9 d4 X& o, c3 u" ]0 O# k( A; u# rfew years has been satisfied, resulting in more normal, balanced conditions./ p6 k' U& N& @. z8 z5 V- o5 P% @$ F+ Z
5 K7 Y+ E# d; ]7 @: y/ { Montreal's housing market recorded modest increases in average house
+ l3 g) o C$ I0 d+ @- r3 Pprices, due to a slight seasonal slowdown in the third quarter as inventory
5 K7 Q( G3 |/ m7 ~/ s X V. Klevels rose. Part of this can be attributed to the fact that many renting0 w+ G4 l% P" J# Q
first-time buyers were motivated to close on the purchase of a home by July 1,% q M2 I5 ~, k+ {6 S
when rental leases expire in Quebec. Once this date has passed some of the# R5 P* \" V# v) \& |! V) w$ P2 w8 i: z
pressure is taken off the market, allowing buyers to visit more homes before
7 Q5 z/ B1 w2 jmaking a purchase.
# T( W3 h) f" q8 g
% J8 h* ^8 S H; \ Ottawa held its position as one of the country's most stable housing
0 k. X' S6 s# K/ Q/ mmarkets in the third quarter, reinforced by a vibrant local economy and strong- w1 ]- ]) q2 u0 x) Y ?
confidence, resulting in modest increases in average house prices. The city
$ N# l. E x4 V! c3 Zcentre remained a bright spot in Ottawa, with homes in this area attracting
6 S: [( Q B/ {- [; a4 L3 H" A6 xattention due to their convenient location and proximity to downtown
+ ?1 F: h: A& ^ F& N( }amenities.
, X0 z% f( P4 d1 P6 \6 @& J2 {+ Y0 w0 M
The housing market in Toronto sustained healthy activity levels
% w$ D% ~' H) M5 h9 `* D! [throughout the third quarter, as a strong economy helped to maintain demand: ?. r" u/ h* j
across the city, causing average house prices to rise moderately. Toronto has
; w, X* Y% K" x* z) Scontinued to experience modest growth in average house prices, and has been
' M7 V" c9 o% W$ E3 b ^& k3 R2 g1 Jdriven primarily by purchasers who are buying homes as their principle1 R/ V' q& G8 W$ K/ a, n0 [5 K3 b# e
residence, rather than for investment.! Z& C! g# n0 v* I& P2 |
6 e! U/ l: g0 Q8 K9 J* o" s3 Z
The vibrant Winnipeg housing market continued to show its strength as
! ~6 {3 t) X9 L/ n8 B5 a+ q- Phouse prices rose during the third quarter. The booming local economy resulted( Z' v4 {' A- U7 c( A
in a historically low unemployment rate, helping to bolster consumer
. ?+ Q$ a. i' S) k( F0 q. Tconfidence and Winnipeg's ranking as the city with the lowest capitalization
v' C* t; O7 d8 d$ v$ l" u" [rate among the country's larger cities - helped to encourage buyers to enter
* w% m2 C) S+ J0 Qthe market.' c$ O5 ^1 z& g
9 i% m8 I* N/ l
In Regina, the market experienced a slight seasonal slowdown through
9 S( S6 I2 x5 q/ t+ @July, as there were fewer purchasers in the market due to summer vacations. In1 D: x4 W0 u. K
August, activity resumed to the busy pace previously seen in the spring% k" d% q% V. }
months, as the influx of purchasers made it more difficult to find a home due
# [! ^: G3 L4 m7 c/ Vto the shortage of available inventory.
9 H; q; H" {/ e1 `& m3 n# B% S9 j( W$ U/ {: f$ T0 `" z
Activity in Saskatoon remained brisk as the market maintained its
. p- r. ?) e, y# o9 wmomentum from the busy spring sales period. The economy in Saskatoon remains3 X' D# q+ [, Z' j) p+ V
vibrant, as employment opportunities are abundant with many businesses( C! u1 x" D1 b; ^! |/ i m
struggling to make hires and having to recruit outside the province.
- w9 K! u7 C! T0 [ Q3 w+ b, p4 \5 z( F& `! L3 e9 q# J& m
Calgary's housing market recorded blazing average house price increases1 K) b7 I' N+ P( y9 O% l
in the third quarter, in all surveyed categories. The burgeoning economy, low ~/ R/ j' _5 [9 l
unemployment rates and low inventory levels remained the leading factors that
: F9 e7 j1 d8 ?8 k' |pressured Calgary's house prices upwards. However, regardless of the soaring8 N' G0 S# J, ~8 m6 u
prices that characterized the market - even during the typically slower summer; D% D+ m* O% n; |$ o9 }
season - it is expected that activity will become slightly more balanced, as
" m! x) [# B7 g! P. q' ]/ f( Tbuyers are becoming more reluctant to participate in the frenetic activity.- P6 |8 N/ T, B* H- k0 x
% Q) k; i1 Q2 F7 @5 g: [
Edmonton's booming local economy continued to thrive in the third quarter! E: q' z/ A$ L7 D
as activity in the oil sands north of the city continued to flourish. Edmonton
; h8 a9 [( r8 r8 [6 iremained the hub of activity for those coming to work in the oil industry,
5 q) o* Z u; W; Q7 bmaintaining tight inventory levels across the city, resulting in prices
. w5 s2 c# ]$ p+ D1 Eincreasing at record levels. However, as inventory levels continued to improve: ^9 J$ g; L" i4 ~: b7 M- j% g' @
in the third quarter the rate of price appreciation should moderate slightly
$ ^$ w* o8 w5 \# }: K$ B X$ _# |towards the end of 2006. 8 O& c% X7 ~1 W, T0 W0 @+ l
, k( D3 E6 a; V2 ^. v
While Vancouver has seen a slight reprieve from the severe shortage of
& o* M+ Z5 ~) m& }1 o- Kinventory that had previously characterized the market, supply is still unable1 Y8 b8 R' j: L( L
to meet demand, driving house prices upwards. Vancouver has a very diverse" b' ~6 M0 i+ }) O( U
group of active buyers - from first-time home buyers to baby-boomers to
9 ~" y$ X- \1 _. eforeign investors - all of whom fuel the demand for houses, placing added6 s) r' Z1 U1 { v
pressure on tight inventory levels.
0 H. q0 m3 h x4 g) W% o" R9 p2 r$ Q; M( H: H0 d% ? I. \
Victoria's market is vibrant and supported by strong economic
2 }2 o( r8 f2 ~3 B2 T5 R. L' P. z. xfundamentals, fuelled by a booming tech sector and a migration of young people
& @" I4 F7 n9 E& {into the city that has continued to support the area's house price increases;! \/ D4 Q3 S6 b# ~1 a' y8 ^
while increased inventory levels have afforded buyers more time when searching/ k- V$ G/ [0 J+ B
for a home, helping to normalize the market's pace.
H1 C! L6 b/ S, s: z8 m! V5 q' y6 a) d0 b& g
<<, ]' n/ T9 `; C: k- O8 }' E
Survey of Canadian Average House Prices in the Third Quarter 2006+ ^3 O4 p( D* J) w- j
, C7 y( ^- C1 d: q
-------------------------------------------------------------------------+ ~; h! p6 ?! A% D
Detached Bungalows Standard Two Storey$ ^! r5 _9 F; @& ^* o; F; _
-------------------------------------------------------------------------! B( J! c" S6 C2 `3 d j" t
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q37 S1 R8 I: t; Z
Market Average Average % Change Average Average& }+ f* B+ r4 W, ?
-------------------------------------------------------------------------* Y- K- u% C+ v8 i, y, r/ ]
Halifax 186,333 173,333 7.5% 198,667 199,000* ^: ?' ]# r+ O( f1 `
-------------------------------------------------------------------------1 s; m' W! p d! ^
Charlottetown 145,000 141,000 2.8% 175,000 170,000
# `7 Z2 U8 V- q9 q9 k -------------------------------------------------------------------------
6 H( Y+ R+ `- v0 a+ J8 S* X Moncton 135,000 127,000 6.3% 129,000 123,0006 L1 H* G. s# w2 [: z6 _
-------------------------------------------------------------------------
5 d; t- |: l2 A7 w% A Saint John 141,200 142,900 -1.2% - -
( T+ h- O& k# q" x/ S$ O; o" _3 d -------------------------------------------------------------------------
: h$ `. ?# j' J2 m St. John's 143,667 142,667 0.7% 200,667 202,333 I$ d' \+ d3 A8 j5 _: C
-------------------------------------------------------------------------
1 r0 n3 S. v7 W9 C) | Atlantic 150,240 145,380 3.3% 175,833 173,583
/ a% k, x" \+ u% y9 k0 h! C -------------------------------------------------------------------------4 B! l0 [3 B3 x# a4 A( C9 j
Montreal 213,691 203,500 5.0% 321,141 316,185
) |7 ~ m; |/ Y D. b -------------------------------------------------------------------------
% V( c; a+ }) ] Ottawa 290,083 278,417 4.2% 285,667 273,250
1 k6 k$ P% I7 r. }! @ E" Q -------------------------------------------------------------------------- P1 v- V3 e; u$ O0 G, E% ]2 t7 _
Toronto 373,368 355,882 4.9% 481,523 474,7667 `2 k, z' E0 H( M5 m
-------------------------------------------------------------------------5 E( E) Q. Z0 h) z
Winnipeg 181,579 159,860 13.6% 202,337 180,707- Z E( O' U5 x$ M: H
-------------------------------------------------------------------------* c) t1 L4 j; _: A; u
Saskatchewan 170,667 156,083 9.3% 182,600 166,500" r/ H5 h* `) n# H/ g$ b: L+ e
------------------------------------------------------------------------- l3 `2 s* f0 C7 s/ k* O3 C& Z
Calgary 395,067 252,411 56.5% 405,778 264,389
5 f! R/ Z8 S5 a* O -------------------------------------------------------------------------1 d- B5 U0 n2 G+ U% }* f. w7 s+ N
Edmonton 286,857 194,857 47.2% 316,429 206,714( N1 x5 h8 a, `
-------------------------------------------------------------------------
& b- i; J, H+ P( H7 p- c Vancouver 704,250 601,000 17.2% 794,000 697,500
& }- u) g6 K+ A1 \$ X- R4 u. X -------------------------------------------------------------------------
- d. o. d, L* T7 Y4 K* C Victoria 375,000 348,000 7.8% 403,000 391,000
* @6 ?: [0 x7 x [# x -------------------------------------------------------------------------* p2 U* e1 c1 `0 G1 D! \. ^: H; O
National 300,365 258,202 16.3% 365,380 322,860( Q+ h" i i. ~; a! g3 u- d# H3 k1 f
-------------------------------------------------------------------------4 }" O/ X# V# \6 b; I: V. V
! w# ~: [1 u8 w. e5 \
-------------------------------------------------------------+ _- w+ s. r* n
Standard Condominium' g ]% y% y y8 A/ t' ~
-------------------------------------------------------------; k) g" e: [$ N. p- Q
2-Storey 2006 Q3 2005 Q3 Condo
) [$ Y6 g& I' p, l1 { Market % Change Average Average % Change; z. Z& j0 A! t- x9 I# I
-------------------------------------------------------------
1 w5 R0 e% ]) F2 u% k* K Halifax -0.2% 142,000 103,000 37.9%
+ ~0 U8 T* }! @3 w, b! ?" o+ t -------------------------------------------------------------9 A" m% E" U; h7 c4 g
Charlottetown 2.9% 98,000 98,000 0.0%
, @! b' ]# @7 V* R6 u( v -------------------------------------------------------------, y6 ^2 l8 H8 }0 r, C
Moncton 4.9% - - N/A" C9 A% V/ a5 L
-------------------------------------------------------------
" a% C9 c. B- c! y Y( @; c- F Saint John N/A - - N/A5 H) Z4 z" c, R0 C6 [1 }
-------------------------------------------------------------
, D/ q: E- }& n3 o1 m6 C St. John's -0.8% 146,333 145,667 0.5%& v- K$ c( q6 p7 l/ e
-------------------------------------------------------------: f% E' S" K. `. w) `/ t
Atlantic 1.3% 128,778 115,556 11.4%
; O" k: o, c* w4 ^: W% ]1 E -------------------------------------------------------------$ o: e. o" J; b" `$ q7 H; H
Montreal 1.6% 193,190 188,016 2.8%' w1 D) U$ ]$ z" G9 c, t" H. w. D) Z
-------------------------------------------------------------
5 N. Z0 k) C& K Ottawa 4.5% 181,083 172,250 5.1%
, S2 F/ {! ~2 L! o0 g3 M -------------------------------------------------------------
; O! `/ b( ]& Z Toronto 1.4% 252,088 242,918 3.8%. S7 E+ t5 F$ {- a
-------------------------------------------------------------
' U/ }" M4 c2 R Winnipeg 12.0% 105,648 96,008 10.0%) H+ Z6 X1 ]1 q- z( \
-------------------------------------------------------------* u, J e9 e+ [' ]1 \) s
Saskatchewan 9.7% 106,250 101,000 5.2%
/ a- V" b! ~5 h- H# K -------------------------------------------------------------2 n" p/ M' W0 v, _2 ` i2 |
Calgary 53.5% 245,844 153,867 59.8%6 R2 {. i5 e: X1 H
-------------------------------------------------------------. i2 w# R: F" O
Edmonton 53.1% 200,433 131,500 52.4%
# F( h+ H9 ]) @0 K+ ] -------------------------------------------------------------
8 m+ F2 ^4 M% C; t Vancouver 13.8% 366,250 323,250 13.3%+ f" `6 K9 ~! g4 E6 W: C& J3 j9 U; v3 {
-------------------------------------------------------------
" N: @" |5 S6 T: T2 r Victoria 3.1% 229,000 220,000 4.1%( W# H7 W6 b: f4 ]/ P3 |
-------------------------------------------------------------9 R6 l7 Z8 ? R, r$ [: V- j
National 13.2% 211,562 185,296 14.2%
7 \& Q9 ~' ^) u- `4 `) q# j1 F4 M -------------------------------------------------------------6 I" O; |8 Z+ B) A
>>" L Y/ |4 a& G% W
; n( Q# y: ^4 o7 l; x
Average house prices are based on an average of all sub-markets examined# G) q" _; X& S$ s# F7 N
in the area, except for the smaller markets of Charlottetown, Moncton, Saint9 d0 X7 @, U, r9 O/ {: ^9 z( W+ h
John and Victoria. u6 n u. j( x1 j/ j- ?* \+ i, h
9 ~+ M; q5 c, S The Royal LePage Survey of Canadian House Prices is the largest, most" n2 K0 R% V5 l- w z( Z
comprehensive study of its kind in Canada, with information on seven types of' @# G8 X4 @1 a$ l; x" R. [; E8 ~
housing in over 250 neighbourhoods from coast to coast. This release& _6 P9 Z- g/ m1 Y: o
references an abbreviated version of the survey, which highlights house price
. H4 X3 }5 c! F9 Itrends for the three most common types of housing in Canada in 80 communities
% I* O% B5 f5 s2 M& ^# A; Dacross the country. A complete database of past and present surveys is
) j' y: _) c/ Uavailable on the Royal LePage Web site at www.royallepage.ca, and current( k) ^8 @1 U( D4 Y* Q* o
figures will be updated following the end of the third quarter. A printable) Z) R9 Y' }0 l: m3 M( @. g! O
version of the third quarter 2006 survey will be available online on P6 L: \7 M) D9 a
November 15, 2006.
* Z$ u) G; u9 u' ] Housing values in the Royal LePage Survey are Royal LePage opinions of
4 t; E8 p. ^( \7 B4 {3 cfair market value in each location, based on local data and market knowledge
( D, v2 F O m( Fprovided by Royal LePage residential real estate experts. Historical data is
/ u8 h" l7 ] ?( I! R% s7 qavailable for some areas back to the early 1970s. |
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