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Canada's housing market both vigorous and stable
4 O# ?+ b p l2 R% |% `9 [7 T3 }" K
$ W" q! r3 X3 G8 \1 ~( g8 y m1 b- Country's market poised to show growth throughout 2006 -
O5 \( ]4 t4 k: U. {. b3 T3 O! A' Q
TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market# E5 t0 w3 D# ^$ ?5 r
exhibited moderate price increases and stable unit sales during the third/ Q" } J" S5 m5 L: k3 V
quarter. Wide regional variances continued to be the dominant characteristic! w) n! ?" S: Z, d0 h2 z
in the market, exemplified by frenzied levels of activity and double digit
8 I9 s+ M: P' S, K gprice gains observed in the energy and commodity rich Western provinces, and
* h& z* x4 r% \& f* x( wmore reasonable sales volumes and moderate price appreciation in Ontario,5 n4 z, ]6 B, E% i% n+ V& `8 d3 [* I
Quebec and Atlantic Canada, according to a report released today by Royal" J1 ]# C& w% @% h" M
LePage Real Estate Services.
- }& a. G; H' S' R0 N& \! B! |, j
+ Q9 F3 ^$ t% R4 s: f Nationally, market trends established through the first three quarters3 {; d' N+ M6 r
are forecast to continue for the remainder of the year. Robust economic
9 k, U8 j T3 G/ Hconditions, low unemployment rates, modestly growing salaries and wages, and
5 n; B8 ], h- wsound consumer confidence contributed to the overall strength of the
4 N! q$ T7 f" x0 R6 ^7 j7 uresidential real estate sector.0 g. v7 K4 \& i0 Q, ?6 V/ y
$ T. A! t% Y. x% [& a* }) N
Of the housing types surveyed, the highest average price appreciation& a; N+ [( E8 r7 f6 R
occurred in detached bungalows, which rose to $300,365 (+16.3%)
( }/ h, ]. m! R- k, iyear-over-year, followed by standard condominiums, which rose to $211,562
; B4 C+ l* R5 q% V(+14.2%), and standard two-storey properties, which increased to $365,380. y2 f, A5 T* ]1 {" c$ s3 Q. T" m
(+13.2%).
0 Y& ^- m" ^/ m5 f+ |5 L6 k( @* h# w/ N3 N( v
"Canada's sturdy housing market continued to demonstrate steady growth/ C P, B) i& ?( y P2 h
during the third quarter. For all but the west, we have moved on from the
* D8 ^! Y1 }+ u+ R: ^; c0 Y: @frenzied expansion that characterized the first half of this decade, and are
/ c2 O. z- w4 `$ H& k9 @poised to show continued growth at a more moderate pace," said Phil Soper,
7 S6 f6 m# g d, T2 u7 F1 ]president and chief executive officer, Royal LePage Real Estate Services.
2 T' L2 O6 r+ P, W( y# M: W"Gone is the sellers' market that we have lived with for some years. We4 j4 w9 \% D) u* p* a+ ?
welcome the more reliable conditions that are characteristic of a healthy2 B) n3 D ]/ p
balanced market."% T- ?- A3 ]3 o) `1 u0 Q$ w
3 v- ?9 k% B$ u/ K
Despite the double-digit rise in average national house prices,. |+ U$ F0 i: e
considerable regional variances were exhibited again this quarter. The shift
5 u. u0 G5 @7 l' w, \to balanced market conditions, which began in late 2005, has continued
1 K' ~# M$ D0 X: s, G$ n, Hthroughout most of the Central and Eastern regions of the country. In the core3 H. [$ K+ h* z
energy producing western provinces, the combination of very high in-migration,0 F. p$ ]! L4 r0 I {2 D) b
manageable affordability, and a shortage of inventory has driven record
1 D6 C6 v H2 w pbreaking price appreciations.
' u) R1 s- I8 W: \2 W8 x
z q. \4 U6 a2 p% { Echoing the second quarter and supported by Alberta's rapidly expanding! O: H. g0 N2 v& q' j( l0 U
economy, Calgary and Edmonton led the charge of Canadian cities with the0 ]2 \6 ?; {7 @
largest house price appreciation in all housing types surveyed.
b9 A8 v4 R2 c9 K; ^: L& F# ]8 f6 {2 F
In Ottawa and Toronto, growth remained steady, supported by solid
' J+ G" y6 z0 q' Keconomic fundamentals, an increase in available inventory and strong consumer2 B! W0 Z. Y e# u- c( \ l
confidence. While the pace of price appreciation in Ontario leveled off$ T0 u5 y; Y0 p, N! X
slightly, the province's real estate market remains poised for modest growth.% T- M& o. \0 y/ e- Z
In Atlantic Canada, new housing and condominium construction offered buyers( q/ i6 o3 x% @/ l4 {
greater selection at more competitive prices, resulting in a slower rate of
' J A3 E( R: Kprice appreciation when compared with 2005.9 Q# e" T- ]* W/ I3 J1 V
& N: k, E7 V2 a+ s- l; D" w$ J While the pace of growth in Canada has slowed, the domestic housing( X2 Y: z0 q5 S
market is expected to outperform the American market. The economic and
5 s4 M* l2 [: qfinancial fundamentals driving the residential real estate sector in Canada
# F* W3 b) V# Iare markedly different than those found in the United States.
' ~1 T6 `9 V( f2 r8 k# L) K3 q' l& ?3 b& ?8 b
Added Soper: "Canada's housing market is likely to outperform the
: y. X6 e, |1 P! F SAmerican market through 2007. A number of factors are working in Canada's5 H; v: {' G S
favour, including healthy personal and governmental debt levels, the
^* P0 p% o5 P; M; g( R0 wrelatively modest rise in interest rates in our country, and general
. B: h4 U' z Taffordability in our major cities. In addition, Americans are now seeing the
* d+ |3 N6 b& l& Zdownside of a tax system that encourages maximum homeowner leverage, and
8 W+ N' x; o% y& ?* R2 aaggressive financial products such as zero- and negative-amortization
: k/ \/ b) Z1 Z" U2 n- t5 `mortgages that work only in a high price growth environment."' D( Q: O/ K- a: C4 U
* y. y* h; l0 a
<<5 e: r9 C, h, n2 ~% \5 N' v
REGIONAL SUMMARIES
# D% ]/ V. U- ]7 D% ^8 e5 ?- d+ o >>& s3 h0 r/ x6 i# q0 Y: Z
1 T! U; O: I- H: z) R& Y# k1 T Balanced conditions continued to characterize the housing market in
4 n5 H* Q8 ]" u/ N, q5 nHalifax, as significantly higher inventory levels helped to moderate the rate j1 _; {0 u0 N3 P" O7 i
of price appreciation. Buyers were increasingly choosy, taking more time
: Z0 k. n/ V$ c) K1 N2 ~3 Y, qlooking for newer, low-maintenance properties that were not in need of
! d9 z! S9 ]8 N& A4 f& t* orenovations.2 ?3 A5 d$ m7 U
! C6 i P1 A C
The housing market in Moncton remained healthy and strong as a slight9 `0 M; l) O3 L
increase in inventory helped to moderate the rate of price appreciation4 O' R. f: h( f$ T' _$ K
compared to the same period in 2005. Activity was brisk throughout August and
2 ~$ ]" G! R! F- [, N: z4 D bSeptember and is expected to remain this way through the fourth quarter.
8 l( v$ Q6 g% A! U/ E3 }
+ h9 ~4 A$ h# i The housing market in Saint John underwent its traditional summer
! F$ n; W5 r; W$ [" dslowdown in the third quarter, with activity picking up towards the end of the! R! n, P) d0 K& k6 d( M
quarter. The local economy continued to thrive, as construction on a new
" r8 p& \' S6 h7 N) q8 c1 O600,000 square-foot shopping area has begun, bringing several new box stores/ u: [) I/ a- s }/ W
to the area. Buyers have begun seeking less expensive fixtures for their homes, Y: P1 ^2 J; u9 k, q
and are instead opting for more affordable housing options.
3 ]' p; E( N# ?/ c" [+ S! u7 z: s
In Charlottetown, the housing market started to move towards balanced
) B7 F# j- J) Hconditions, as some sellers had to begin to lower the asking prices on their
# X% e; z' q4 R' m6 Lhomes to make them more competitive. Activity from out-of-town and US buyers( ^ h- f$ ?- Q9 ?
was down slightly compared to 2005, likely attributable to the strong Canadian4 H" z3 D$ }5 b! a8 q& P
dollar. Inventory levels began to creep up in the third quarter, providing
4 S$ j" g6 N' g9 j0 n, j( hbuyers with more options when looking for a home.
, n# j r& L: @4 i1 g' b' O$ o; `# f6 ]% Y) R! H& N
Activity in St. John's slowed slightly in the third quarter, particularly
8 U7 b" N3 ^5 G/ D* zamong higher-priced properties, where there was a slight over-supply of homes
* A" b' b. [( b+ W- d' T- fpriced over $200,000. Listing periods have increased when compared with 2005,
3 b! ?; n% E6 E+ d& b' e) Tas some of the pent-up demand that had characterized the market over the last
$ u) n" m* R8 n2 [2 B" Jfew years has been satisfied, resulting in more normal, balanced conditions." S* i. d, f. [6 q& M1 J9 d9 e% u
z% E4 d1 Y; T2 B7 G Montreal's housing market recorded modest increases in average house
5 T) K# r/ c, Q# B% I9 f2 n: [prices, due to a slight seasonal slowdown in the third quarter as inventory
9 A8 Z9 r B) G/ w7 n% B& I; M- K) R7 [levels rose. Part of this can be attributed to the fact that many renting$ Z+ @7 F! J& \
first-time buyers were motivated to close on the purchase of a home by July 1,
( I) ~" Z% A9 e/ _6 }. D1 X4 vwhen rental leases expire in Quebec. Once this date has passed some of the2 f2 p4 X" y5 s. X' y
pressure is taken off the market, allowing buyers to visit more homes before
' y' G# X$ `. a9 @( e* f& q* Rmaking a purchase.; s4 k0 [% ^- y$ z
; Q5 X1 y; \ G0 f
Ottawa held its position as one of the country's most stable housing1 I7 {) a! }; q5 v% y! @
markets in the third quarter, reinforced by a vibrant local economy and strong
- z2 P9 f7 g) z G5 T oconfidence, resulting in modest increases in average house prices. The city `( K! s" Z/ ]6 Q6 F T
centre remained a bright spot in Ottawa, with homes in this area attracting! V: E# O0 J/ p! V. P" ~" }
attention due to their convenient location and proximity to downtown( P- j; D2 [$ b9 X* n
amenities.2 O3 t) V9 h& ^/ Q
! t( ?7 T/ {/ _9 r
The housing market in Toronto sustained healthy activity levels ?' H/ o, g2 m8 L
throughout the third quarter, as a strong economy helped to maintain demand4 e+ o; ]6 P, u) Y. q
across the city, causing average house prices to rise moderately. Toronto has
% s/ p ]6 N7 [% J. Q9 s# R4 b& [ y$ Scontinued to experience modest growth in average house prices, and has been
2 ?# p4 r* H5 q/ ~4 d& ^driven primarily by purchasers who are buying homes as their principle
9 e0 u5 N8 m* F R# Q, F+ a) Nresidence, rather than for investment.
/ T- u! k, @, S
& z! P! G8 P7 c; t. R% l, | The vibrant Winnipeg housing market continued to show its strength as( o9 H( o1 d4 I% w: C
house prices rose during the third quarter. The booming local economy resulted0 e% R: b( f' D9 c6 {. j# I7 X
in a historically low unemployment rate, helping to bolster consumer: Q7 O$ b) u4 `! F* w; [) K
confidence and Winnipeg's ranking as the city with the lowest capitalization: v6 L& i& ]% q
rate among the country's larger cities - helped to encourage buyers to enter5 C( D% D5 x" f
the market.1 M, d" x9 o, h" {
, ^9 O5 u/ n- P% v. I7 k( ]+ r In Regina, the market experienced a slight seasonal slowdown through2 v# ?/ x: O L7 q: u' D% j
July, as there were fewer purchasers in the market due to summer vacations. In
! c; S3 x" V+ |9 Y EAugust, activity resumed to the busy pace previously seen in the spring; h) i( G! y. }/ Z( o" M
months, as the influx of purchasers made it more difficult to find a home due' f& _7 @$ ?; i; I
to the shortage of available inventory.5 d9 S0 [" [. Z8 d7 z" z
I) K; G9 n' j5 M" l. g
Activity in Saskatoon remained brisk as the market maintained its
8 k! w: j* F, m" ?1 O gmomentum from the busy spring sales period. The economy in Saskatoon remains$ j; I: R4 j& K m; o: r" ?7 b
vibrant, as employment opportunities are abundant with many businesses
0 \9 c9 c& M6 m) k% t* Wstruggling to make hires and having to recruit outside the province.6 L+ `, X% ~! O
" S0 _+ f' W3 Y0 r }, _
Calgary's housing market recorded blazing average house price increases
% C! _5 u# p& q% P2 Nin the third quarter, in all surveyed categories. The burgeoning economy, low( p- i) G! V8 J# Y
unemployment rates and low inventory levels remained the leading factors that
) \7 o, _6 `" i6 g J* h' hpressured Calgary's house prices upwards. However, regardless of the soaring7 X0 V L3 j8 e! }
prices that characterized the market - even during the typically slower summer
# b5 n, m4 \; x4 \; Gseason - it is expected that activity will become slightly more balanced, as* X, c* {3 m5 \' Y! c$ _8 {
buyers are becoming more reluctant to participate in the frenetic activity.9 ?; K0 n, m' s2 ]5 a- A' S
O0 b# N( G9 o8 U: N Edmonton's booming local economy continued to thrive in the third quarter% B! S. j1 Q8 v# z8 G
as activity in the oil sands north of the city continued to flourish. Edmonton; F1 R' b1 }: i
remained the hub of activity for those coming to work in the oil industry,+ ?5 ?" j, C# S& H% q
maintaining tight inventory levels across the city, resulting in prices
1 Z+ C! N. {" l9 R" C6 z6 M1 tincreasing at record levels. However, as inventory levels continued to improve. X6 K: T" R, j: u3 \! J! z
in the third quarter the rate of price appreciation should moderate slightly
7 E+ K! m4 v wtowards the end of 2006.
: }# \7 l7 t/ g2 y! @. F1 T2 W5 p# G
While Vancouver has seen a slight reprieve from the severe shortage of
) O2 U! L, M0 [# Rinventory that had previously characterized the market, supply is still unable; q3 P. t' T- C! Q F- w
to meet demand, driving house prices upwards. Vancouver has a very diverse
) ^; X: ]5 g3 Z0 v) c% zgroup of active buyers - from first-time home buyers to baby-boomers to
! ?. l5 |* y9 w7 e' d% ?, Sforeign investors - all of whom fuel the demand for houses, placing added
8 N* K) j( A4 A' H) upressure on tight inventory levels.
$ I! o# v- z8 ^. f3 w$ n
* `" Z0 \! a- y. B( r Victoria's market is vibrant and supported by strong economic& ~2 _/ U, d. |6 p
fundamentals, fuelled by a booming tech sector and a migration of young people
% k$ U1 _9 @6 Y; Y7 J+ cinto the city that has continued to support the area's house price increases;
+ W7 t+ s# |) q* n- p1 s! Rwhile increased inventory levels have afforded buyers more time when searching6 V$ N/ y9 ]+ J$ ?
for a home, helping to normalize the market's pace.
# n# g8 `5 x+ u0 X6 W @8 Q8 M: Z
<<
. `# @4 d& c) _ a6 u& } Survey of Canadian Average House Prices in the Third Quarter 2006* a3 ^. w1 T+ \8 |. X* [/ M
6 T: e- x1 l4 M" c, P1 ]9 D7 I -------------------------------------------------------------------------0 |3 b0 {6 _( i# w( W( ]
Detached Bungalows Standard Two Storey) L" N8 N1 ~! p( I
-------------------------------------------------------------------------
, d0 D0 ?/ l! o 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q32 ~( ^& \, v1 Z) n& {6 |8 A
Market Average Average % Change Average Average
$ |7 M+ v5 Y( l. R8 Q, _2 f -------------------------------------------------------------------------
. H7 ^. L/ X+ Y2 t# c Halifax 186,333 173,333 7.5% 198,667 199,000
5 T9 l U5 n; L -------------------------------------------------------------------------
% l$ A$ p6 p r* q# q+ C Charlottetown 145,000 141,000 2.8% 175,000 170,0001 F' c2 V4 j: ~1 q( B) w+ @
-------------------------------------------------------------------------
5 Z, w" a3 { n: ?4 K4 h* q: ~ Moncton 135,000 127,000 6.3% 129,000 123,0004 c+ i& g3 O2 b# P7 f m
-------------------------------------------------------------------------
& x% k7 F- `5 x. ]" G4 C Saint John 141,200 142,900 -1.2% - -' J H) |5 r1 l
-------------------------------------------------------------------------
5 W5 w# ]$ j* ?1 D1 b St. John's 143,667 142,667 0.7% 200,667 202,333: ?% @5 L) W9 o: L
-------------------------------------------------------------------------* D+ [4 n; j, y
Atlantic 150,240 145,380 3.3% 175,833 173,583
. n/ i8 O, ]( b -------------------------------------------------------------------------
1 e0 i9 L4 @4 u% {" q Montreal 213,691 203,500 5.0% 321,141 316,1856 C& s& V1 m: g8 U+ N6 E; w
-------------------------------------------------------------------------. m$ Z, `: T7 @+ c$ l% _
Ottawa 290,083 278,417 4.2% 285,667 273,250# M( h6 l( C7 ]. h7 p7 a
-------------------------------------------------------------------------: P! h2 @1 `, j# m9 Q. P
Toronto 373,368 355,882 4.9% 481,523 474,766; h% V% \3 Z" D i' w0 D
-------------------------------------------------------------------------$ _+ X- i9 y. a; |! F# H8 |
Winnipeg 181,579 159,860 13.6% 202,337 180,707! O4 E0 q8 ?' _7 H) u1 {
-------------------------------------------------------------------------# }! }/ X( }8 z1 c6 F4 N
Saskatchewan 170,667 156,083 9.3% 182,600 166,500 U9 s ?. k6 y F
-------------------------------------------------------------------------
( u$ I/ N# K9 ]) D; | Calgary 395,067 252,411 56.5% 405,778 264,3899 O* R1 ]" |% a2 w0 c
-------------------------------------------------------------------------! I9 D2 P/ y" C4 D% _6 t
Edmonton 286,857 194,857 47.2% 316,429 206,714
) L$ w/ P+ c1 P; V V3 O) C, y -------------------------------------------------------------------------
3 Y$ ]# D, g* m5 @0 N, P4 ? Vancouver 704,250 601,000 17.2% 794,000 697,500
- L( @5 |2 C2 G- T4 U, Z8 o i -------------------------------------------------------------------------& ~( ^' X. i5 `3 Z% z! k9 c$ x3 K9 [
Victoria 375,000 348,000 7.8% 403,000 391,000
+ m8 s# j, A: t" [# R; h4 T( M9 d0 g -------------------------------------------------------------------------
7 f! j0 e( ~/ t$ `( r1 I V3 s) C National 300,365 258,202 16.3% 365,380 322,860
! U4 `+ s( ?$ O -------------------------------------------------------------------------9 Y$ M/ a+ _; a7 }; I1 V
4 \2 W) @1 s" y/ w1 k3 u! a5 F+ A -------------------------------------------------------------
/ V: C3 o4 X7 @: f8 T Standard Condominium
% }1 X! f2 T: m -------------------------------------------------------------
% {0 z" x" c t* ~2 k9 n J 2-Storey 2006 Q3 2005 Q3 Condo
% q: @/ W" O- P- L0 v2 A9 U8 @6 w1 g Market % Change Average Average % Change
' k: A9 M. m; f! V8 u5 _ -------------------------------------------------------------
6 B5 g9 A1 i4 @! J8 R, O Halifax -0.2% 142,000 103,000 37.9%+ T. [1 z% Z( P$ A9 N. W5 U
-------------------------------------------------------------: U" P( P# U9 F o
Charlottetown 2.9% 98,000 98,000 0.0%% e6 Q0 l/ L* `2 }! \
-------------------------------------------------------------
& O A6 J# v; r$ k Moncton 4.9% - - N/A6 Y1 @- C* w% T* J
-------------------------------------------------------------4 X2 O. y" ^. Q" u2 n" ^
Saint John N/A - - N/A% s5 L: ~7 n; T& q( f
-------------------------------------------------------------8 l3 ?. w% e6 g8 P* v: p* ]. {! w8 p
St. John's -0.8% 146,333 145,667 0.5%
' ]% \8 `& E4 J1 g -------------------------------------------------------------
. C C0 S) z3 `4 U1 j( q Atlantic 1.3% 128,778 115,556 11.4%# P% m# B' H M' N2 V9 `
-------------------------------------------------------------
# c7 Y. b9 X+ p2 ~ Montreal 1.6% 193,190 188,016 2.8%
" h5 X8 [+ L9 R. k -------------------------------------------------------------" z. q0 M2 {6 a. V! V: v
Ottawa 4.5% 181,083 172,250 5.1%
: j" {! k4 H- m) n -------------------------------------------------------------# _$ Q/ R- I7 r' g8 D$ o& ?3 ?
Toronto 1.4% 252,088 242,918 3.8%
a1 E2 k/ t# i2 [* n/ M$ E+ r: A -------------------------------------------------------------
0 p& ?: v2 {9 A4 h# `& w6 y, }2 n* x$ X Winnipeg 12.0% 105,648 96,008 10.0%0 X2 n$ I3 L. l0 ~* A
-------------------------------------------------------------9 t/ F; m7 X6 Z) H) ^! p
Saskatchewan 9.7% 106,250 101,000 5.2%9 V. M+ l p' C% d
-------------------------------------------------------------
1 @8 H7 n8 m8 Y& h' k Calgary 53.5% 245,844 153,867 59.8%9 T' @' `( h; h, i* ~- o% W
-------------------------------------------------------------
4 b8 f7 R2 S1 f" s Z6 F Edmonton 53.1% 200,433 131,500 52.4%& w; d% t% r: _
-------------------------------------------------------------
# K K$ I$ E8 a. G- L. a" d( e Vancouver 13.8% 366,250 323,250 13.3%
% I# P5 x6 E: [' V" Q -------------------------------------------------------------
. F7 R1 t, U# q1 M# m) j) T Victoria 3.1% 229,000 220,000 4.1%
! n: u f9 |, e1 E4 E -------------------------------------------------------------; k0 V9 P4 T( E6 B, \" n
National 13.2% 211,562 185,296 14.2%) a( r P( I* z& h* b/ W
-------------------------------------------------------------& r" N0 L0 h, z) `9 S8 p
>>$ O5 f7 G& O- r; F; c1 J% t
2 f$ B# H8 X4 `4 N2 [/ _/ G8 C Average house prices are based on an average of all sub-markets examined# f8 R1 z. b1 \/ m% L
in the area, except for the smaller markets of Charlottetown, Moncton, Saint
6 ~' p; z0 t" `# m4 ?0 j& X: t" j( qJohn and Victoria.
! k( T& s, u2 O! S6 B
( p1 ]) y: K# v5 K' l The Royal LePage Survey of Canadian House Prices is the largest, most, |; z6 W3 H( r
comprehensive study of its kind in Canada, with information on seven types of
: B& b: f/ C7 Z0 L- U* {housing in over 250 neighbourhoods from coast to coast. This release
+ k5 L( w- {8 b5 Breferences an abbreviated version of the survey, which highlights house price
; z L% @& z/ v" Ktrends for the three most common types of housing in Canada in 80 communities. G) R/ N. ]0 k3 J$ g. b% d
across the country. A complete database of past and present surveys is, h# I, Q8 T U, Z/ L/ [, {4 B
available on the Royal LePage Web site at www.royallepage.ca, and current
9 _' @& Y7 d' z9 Q% S* H6 F. Ufigures will be updated following the end of the third quarter. A printable8 x4 {. I4 f0 y) O# \
version of the third quarter 2006 survey will be available online on
& |, R) p# f) q8 ~November 15, 2006.
! g3 \8 B5 r/ B$ Q5 T$ ~6 M Housing values in the Royal LePage Survey are Royal LePage opinions of
; d0 @8 y# Q v8 h5 f/ _' _% r ifair market value in each location, based on local data and market knowledge- d6 B# ^8 n: \ b# P, r
provided by Royal LePage residential real estate experts. Historical data is
4 j/ ~" x4 \ }available for some areas back to the early 1970s. |
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