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Canada's housing market both vigorous and stable
* |3 ~& M2 B+ y3 O, u
3 M# ^& t4 g% E+ g# i9 r- Country's market poised to show growth throughout 2006 -/ ]* H6 x- H% j+ T/ ?& w- i
2 a. G9 l" O9 i4 L
TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
+ s1 v k& F. `# T2 ~! ~1 n6 P7 cexhibited moderate price increases and stable unit sales during the third
5 J- ^' j( W8 N- m" rquarter. Wide regional variances continued to be the dominant characteristic6 Y% q' s! U ? V
in the market, exemplified by frenzied levels of activity and double digit* A# _ U7 D9 n% e* n. P i& r' u
price gains observed in the energy and commodity rich Western provinces, and
4 ^. q8 p K1 T' B1 Qmore reasonable sales volumes and moderate price appreciation in Ontario," v$ m# o& S: C r' [1 H6 ?/ s
Quebec and Atlantic Canada, according to a report released today by Royal
3 i$ R, }+ d. [, A/ y) pLePage Real Estate Services.
! {) j1 \- {' f0 Z
# L% O7 _; F3 g5 B Nationally, market trends established through the first three quarters( L( M" Z; M9 c1 [9 T
are forecast to continue for the remainder of the year. Robust economic
, P5 m" _3 H' w% d3 a( \conditions, low unemployment rates, modestly growing salaries and wages, and/ ?0 R% C) I% k) S) r! k' u
sound consumer confidence contributed to the overall strength of the3 \6 \4 B( R; O
residential real estate sector.
1 `: o8 c3 N7 R" a& d( Z( y9 B; {$ H8 `9 `+ F8 {
Of the housing types surveyed, the highest average price appreciation
& l( e# K" n* I) [" Poccurred in detached bungalows, which rose to $300,365 (+16.3%)
/ k, r8 @" k$ }year-over-year, followed by standard condominiums, which rose to $211,562* `; Z) _; p) Z4 V! I2 U
(+14.2%), and standard two-storey properties, which increased to $365,380
( O) u% O8 f9 i4 z- b& W8 B& ^(+13.2%).
$ n3 d' r; }9 y f! [2 X6 V6 t& G5 P5 z
"Canada's sturdy housing market continued to demonstrate steady growth
$ v& M# |0 u' |( F1 r. Nduring the third quarter. For all but the west, we have moved on from the
4 ]/ m( @1 L; ^% C) _; Q9 X9 S- Xfrenzied expansion that characterized the first half of this decade, and are
% |5 A8 C0 F" ^( w+ @poised to show continued growth at a more moderate pace," said Phil Soper,5 ^! N) k# v4 x
president and chief executive officer, Royal LePage Real Estate Services.
) @0 I9 [2 d) x$ d6 c+ F% \4 N"Gone is the sellers' market that we have lived with for some years. We- t! a( s' O& I' C
welcome the more reliable conditions that are characteristic of a healthy( t6 f6 `; Q7 ]8 [
balanced market."
* y2 r3 }! q" D4 q- z
2 `) o: r% W8 Q% F Despite the double-digit rise in average national house prices,
r/ I b+ a. Z5 a7 u3 \considerable regional variances were exhibited again this quarter. The shift
& X0 `' I: {6 J1 zto balanced market conditions, which began in late 2005, has continued r+ y( F8 v3 Y \* m/ @# j
throughout most of the Central and Eastern regions of the country. In the core% G' V# b0 l5 G8 ]' C5 G
energy producing western provinces, the combination of very high in-migration,
$ m4 J' U1 O! `3 E! g5 i: qmanageable affordability, and a shortage of inventory has driven record
& I4 }' g6 Y( T9 e# R/ |" ]breaking price appreciations.0 l' O- O/ U' a# L$ }
% r6 p/ b% x- o5 N1 |, r
Echoing the second quarter and supported by Alberta's rapidly expanding* X+ t0 w* r8 l. V$ e. ~
economy, Calgary and Edmonton led the charge of Canadian cities with the
: J. e7 T, Y9 X6 M: Ylargest house price appreciation in all housing types surveyed.4 A" ?( g& c& ?
+ r. f% K* U5 O$ Q9 i In Ottawa and Toronto, growth remained steady, supported by solid
# z# F+ @" N( _1 [. l. qeconomic fundamentals, an increase in available inventory and strong consumer9 X- N4 w0 f/ ~# A; I
confidence. While the pace of price appreciation in Ontario leveled off
/ K" }8 E m5 B' O) ^slightly, the province's real estate market remains poised for modest growth.
% Y# S- ~# T H; F# P6 b9 z' R* MIn Atlantic Canada, new housing and condominium construction offered buyers- ?# _, d; q: R4 \5 \. h
greater selection at more competitive prices, resulting in a slower rate of9 K' j+ M, p5 S7 e* q/ E
price appreciation when compared with 2005.
$ S5 ^# T) u4 m* i/ x2 C) R0 }( ^; x
While the pace of growth in Canada has slowed, the domestic housing
4 `+ j/ {$ O% O& ]market is expected to outperform the American market. The economic and* l$ j' c* g1 l& v! P; p
financial fundamentals driving the residential real estate sector in Canada( P/ b, h4 N) K# S+ b: j& F' P
are markedly different than those found in the United States.- k8 g, h9 t4 u: ?8 p P
8 a, M9 o4 \$ {7 U" Q6 K0 H
Added Soper: "Canada's housing market is likely to outperform the
+ u# c- t3 n$ UAmerican market through 2007. A number of factors are working in Canada's
) i" @+ I* H U5 O" G6 i7 a3 Afavour, including healthy personal and governmental debt levels, the
1 j5 h% b W( E- H# }relatively modest rise in interest rates in our country, and general, F0 ~6 m0 m, O4 H9 w7 A0 a
affordability in our major cities. In addition, Americans are now seeing the
7 M" r% [! A; vdownside of a tax system that encourages maximum homeowner leverage, and% M0 v/ _+ L4 ]6 c% e# a
aggressive financial products such as zero- and negative-amortization4 \: O1 f) ~$ A3 q4 S3 t, I
mortgages that work only in a high price growth environment."5 Q1 |. ?1 M4 w$ C. A! f% v
& Y0 l/ w+ `8 e# |5 D6 Q5 h <<
, y+ q: d, c- ~* T REGIONAL SUMMARIES
; I. [3 j2 [& v" ~( J >>1 v% ^0 h# w7 r9 |1 x: o" D
. {% L" E( a$ J2 l Balanced conditions continued to characterize the housing market in* l! Y- z# m4 G7 e h0 H
Halifax, as significantly higher inventory levels helped to moderate the rate
) V" _6 w5 `; a8 l7 ^+ L. |of price appreciation. Buyers were increasingly choosy, taking more time% j, g" K1 o& @% R' y1 R: R
looking for newer, low-maintenance properties that were not in need of
6 e; s; f- r. ]0 ^renovations.5 H) k1 S( s; W( x
, u+ j- g) t8 i' S! {' U9 X( A The housing market in Moncton remained healthy and strong as a slight g+ ?& n g- U+ A: p f- ]" S
increase in inventory helped to moderate the rate of price appreciation
5 z. j9 i3 W5 Dcompared to the same period in 2005. Activity was brisk throughout August and
4 F4 K9 u9 j; r/ t. k3 `September and is expected to remain this way through the fourth quarter.
9 X& `2 {# t/ Z, S
# Q5 b& f4 q$ g8 P1 ? The housing market in Saint John underwent its traditional summer3 }& \+ D4 r: n) l" C; a8 S3 _% H
slowdown in the third quarter, with activity picking up towards the end of the) t0 r5 F% E) B7 Q- e, `2 Q
quarter. The local economy continued to thrive, as construction on a new
" G7 X! J( `- m. A9 ?! E600,000 square-foot shopping area has begun, bringing several new box stores
+ B/ E. N. V4 Q/ Eto the area. Buyers have begun seeking less expensive fixtures for their homes
# U2 `( \0 u2 A+ r1 Eand are instead opting for more affordable housing options.
# n. s9 E3 }3 M5 R& A: U
" n; R" u7 N% V. A4 V2 c* F* G. z In Charlottetown, the housing market started to move towards balanced
; k. o5 C( Y) sconditions, as some sellers had to begin to lower the asking prices on their, W/ V5 E5 T2 P' P9 z1 I: A# m
homes to make them more competitive. Activity from out-of-town and US buyers5 C; D, a$ `3 s5 m
was down slightly compared to 2005, likely attributable to the strong Canadian
/ q: \ E4 T) K+ [7 d3 h+ Bdollar. Inventory levels began to creep up in the third quarter, providing9 p+ x# x2 \2 X; v; _
buyers with more options when looking for a home.7 T7 ^ N+ \/ q7 K, \. _
( L4 F R1 z+ n" r W+ U Activity in St. John's slowed slightly in the third quarter, particularly
! q0 Z Q7 U& }8 `" Hamong higher-priced properties, where there was a slight over-supply of homes
5 @$ w& j8 T; a& `* Mpriced over $200,000. Listing periods have increased when compared with 2005,# H5 S0 K" ?. T6 z J8 i
as some of the pent-up demand that had characterized the market over the last3 f- x% Z8 u7 k3 z: v. k0 B
few years has been satisfied, resulting in more normal, balanced conditions.
) G/ f3 }( x( T) u7 x- S+ ?2 w* x$ N0 G5 ]
Montreal's housing market recorded modest increases in average house
; Y- |7 h, }& X% k# k1 Z' a6 Iprices, due to a slight seasonal slowdown in the third quarter as inventory- U9 A9 m0 U0 p n/ c7 C+ V( ]5 x
levels rose. Part of this can be attributed to the fact that many renting0 ^1 U9 n2 T" s" `
first-time buyers were motivated to close on the purchase of a home by July 1,
% m9 K# {* E' a& owhen rental leases expire in Quebec. Once this date has passed some of the
6 @6 ` N7 Z6 J; z6 \: vpressure is taken off the market, allowing buyers to visit more homes before
_3 Q) b+ I: C3 t% ~# n2 |, ^making a purchase.
: W$ d1 i, ~- y, j
+ {) I# P4 ~5 b, E* }8 S( O Ottawa held its position as one of the country's most stable housing6 c$ f3 R. K6 ]+ ~# P2 g8 a
markets in the third quarter, reinforced by a vibrant local economy and strong7 ^ Y. j6 X: G. R" i/ J
confidence, resulting in modest increases in average house prices. The city
7 Z3 H2 s0 I; g( K/ |centre remained a bright spot in Ottawa, with homes in this area attracting
; K5 w( n, h9 d: Oattention due to their convenient location and proximity to downtown
0 O# N6 u! `! o$ Q Gamenities.
7 J5 b7 b! E7 b7 S( t: I+ Q1 r6 K! t6 m n0 H4 B
The housing market in Toronto sustained healthy activity levels, x6 V# W, e7 o6 D2 O4 r* W2 m. ^
throughout the third quarter, as a strong economy helped to maintain demand& l0 ?6 s8 @) y; k z
across the city, causing average house prices to rise moderately. Toronto has
- }% i, K1 i% y8 K) w$ pcontinued to experience modest growth in average house prices, and has been
9 ]% v( f$ \9 R. wdriven primarily by purchasers who are buying homes as their principle# E. M9 b1 p: h" q
residence, rather than for investment.5 t* ]* ~$ s4 W! `. P! q, Q/ J
% q) H# P1 t9 A: y$ r$ R: c The vibrant Winnipeg housing market continued to show its strength as
, l. d& @- k" a$ e4 Y2 n# Q" Nhouse prices rose during the third quarter. The booming local economy resulted
9 Z _) c. Z, t' }5 ~, O) iin a historically low unemployment rate, helping to bolster consumer O" ?3 M! R- c' f3 t) L9 t
confidence and Winnipeg's ranking as the city with the lowest capitalization
$ C" Y; m" J s$ lrate among the country's larger cities - helped to encourage buyers to enter
1 T3 Y+ `) ^; c3 b ]the market.
5 W- u6 ]/ W+ [# \$ f$ q# r6 J) b; l& i2 ], l
In Regina, the market experienced a slight seasonal slowdown through& Q6 W' X5 i b! O; t! t
July, as there were fewer purchasers in the market due to summer vacations. In
( _; i' ?6 }3 r% e$ _August, activity resumed to the busy pace previously seen in the spring7 l6 a* T, \/ j7 f
months, as the influx of purchasers made it more difficult to find a home due3 i% R' t! F+ F( ~! O5 m! Q
to the shortage of available inventory.. ?9 w+ p% O% f1 A& r
, n. W3 N8 q! Y1 J) V1 c( Z Activity in Saskatoon remained brisk as the market maintained its: W: `7 H# ?/ j* D) u0 I
momentum from the busy spring sales period. The economy in Saskatoon remains
' h8 I4 {: t& Lvibrant, as employment opportunities are abundant with many businesses
; r* y3 T' k: `/ ?7 u# S. h" jstruggling to make hires and having to recruit outside the province." V- ?- n- O) y& U( T/ @. i
3 B9 l9 P6 v2 u* {) w* \% R
Calgary's housing market recorded blazing average house price increases
2 R5 K: l2 x6 B& }9 ]3 Yin the third quarter, in all surveyed categories. The burgeoning economy, low
$ w6 d2 | @9 ?5 q7 j# vunemployment rates and low inventory levels remained the leading factors that
3 G, n- a, |) z ipressured Calgary's house prices upwards. However, regardless of the soaring# R8 T) b. U2 a6 y; o
prices that characterized the market - even during the typically slower summer, [" I6 w& B- _6 \8 T
season - it is expected that activity will become slightly more balanced, as% E; }4 Q+ ]0 V$ S8 `
buyers are becoming more reluctant to participate in the frenetic activity.. m& T& H& U2 n2 `& Z" K' j& P' p
8 k& W, { t m7 _
Edmonton's booming local economy continued to thrive in the third quarter
* ^: o5 P4 \( k2 S4 q; K" |+ Gas activity in the oil sands north of the city continued to flourish. Edmonton( z6 w. Z1 H$ q3 V2 i
remained the hub of activity for those coming to work in the oil industry,
- D8 E5 F$ ?% W2 P/ g& Smaintaining tight inventory levels across the city, resulting in prices
* y( C% A& u% K* R! `+ sincreasing at record levels. However, as inventory levels continued to improve8 ?- [* Y; ^$ `/ m
in the third quarter the rate of price appreciation should moderate slightly
5 o8 n) [* d# E* ztowards the end of 2006. : ?9 w$ O1 z( Q6 e. N
! ?+ T' B7 \6 e+ _4 C: l
While Vancouver has seen a slight reprieve from the severe shortage of
3 X' ]/ t" c# l9 d/ Cinventory that had previously characterized the market, supply is still unable
H& \. @: S! X" F- t5 I' }to meet demand, driving house prices upwards. Vancouver has a very diverse6 {& S7 y& [. Q+ T8 H, Q
group of active buyers - from first-time home buyers to baby-boomers to
% w% p! ^( Z- fforeign investors - all of whom fuel the demand for houses, placing added
2 x% p9 D* [1 V5 {9 ^5 qpressure on tight inventory levels.
% ?" k! a) e0 t& e
1 F! v0 n: [3 T5 C Victoria's market is vibrant and supported by strong economic+ q+ @$ K& x' w9 ^ A! J
fundamentals, fuelled by a booming tech sector and a migration of young people
: R- E% F P/ ~into the city that has continued to support the area's house price increases;, A8 \' V. p% P. F( q
while increased inventory levels have afforded buyers more time when searching
. w7 R. {! N5 t8 M* x& `0 }for a home, helping to normalize the market's pace.. M* }% N* O/ [; x
6 }) l( _8 G1 n, k <<
9 a" ^1 u. T k2 T, @) l Survey of Canadian Average House Prices in the Third Quarter 2006
) x5 t& F" |2 E" a4 p3 c* l8 S- E/ B
- r1 t" f2 f/ l3 N3 E, A -------------------------------------------------------------------------
0 H7 Z& z) ^$ i# ?* m: @ Detached Bungalows Standard Two Storey0 p* Z& ?6 W! n- R
-------------------------------------------------------------------------% }! w2 L: w2 K
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3- k6 P0 q0 Y4 O' O
Market Average Average % Change Average Average! U! S. x- R0 D$ O2 X2 P
-------------------------------------------------------------------------
5 }, ^$ z7 H2 \& B Halifax 186,333 173,333 7.5% 198,667 199,000# P! h) M4 @% V" i; v
-------------------------------------------------------------------------
& ^+ n3 Z7 |6 V: w' U* X3 o) S Charlottetown 145,000 141,000 2.8% 175,000 170,000
3 @# u% m$ Y% C+ @# r& `* D5 U) q -------------------------------------------------------------------------
' z5 C3 }- s# S; E1 h/ {( [( T% T Moncton 135,000 127,000 6.3% 129,000 123,000
, o! B: @4 J' ]0 }- I -------------------------------------------------------------------------
9 x/ h, U. O$ @* [/ l7 e( ` Saint John 141,200 142,900 -1.2% - -2 G( J2 \" ]2 D0 @/ ?- t
-------------------------------------------------------------------------. `: [3 m9 K8 g0 N5 {
St. John's 143,667 142,667 0.7% 200,667 202,3330 N! c: n5 p- I& E$ y! Q% s- C
-------------------------------------------------------------------------
% X) ?" ?1 g' Q' d$ K" X' p3 Y( n Atlantic 150,240 145,380 3.3% 175,833 173,583
_7 ]* C# W( z- W$ u9 `% W -------------------------------------------------------------------------
9 ^9 K6 w0 f& ^/ s6 P& d+ s2 f& u Montreal 213,691 203,500 5.0% 321,141 316,185
* A8 N& ?% y; L; Z3 } -------------------------------------------------------------------------4 n8 Z; v. G7 [
Ottawa 290,083 278,417 4.2% 285,667 273,250, z. T7 H& ?& }+ b( |2 R
-------------------------------------------------------------------------! d1 u2 z! i( O1 j5 p
Toronto 373,368 355,882 4.9% 481,523 474,766
" T1 i0 k# r7 r2 M -------------------------------------------------------------------------9 q6 R. ?/ q6 f3 }( q( t
Winnipeg 181,579 159,860 13.6% 202,337 180,707
1 A) X7 v0 a9 o+ _' E4 C -------------------------------------------------------------------------
4 s" q6 k2 w, g/ p6 S! N Saskatchewan 170,667 156,083 9.3% 182,600 166,500
" d" N% g& T# U! p* C -------------------------------------------------------------------------4 p9 a8 `7 h7 H; O
Calgary 395,067 252,411 56.5% 405,778 264,389
. R2 s+ z9 i/ o; `$ p) _; E( H -------------------------------------------------------------------------8 Z2 ]$ e% G9 E* M. i! i
Edmonton 286,857 194,857 47.2% 316,429 206,714* a4 w- i' v7 f& R# F% H" s e
-------------------------------------------------------------------------0 E0 O- @' X4 t- I, q
Vancouver 704,250 601,000 17.2% 794,000 697,500
$ y* Q6 j$ |$ e I+ [' ~ -------------------------------------------------------------------------
% y" r' F5 s u0 Z. J Victoria 375,000 348,000 7.8% 403,000 391,0009 K; K7 O$ h+ N& h0 h
-------------------------------------------------------------------------+ R( C) v' U8 h
National 300,365 258,202 16.3% 365,380 322,860
* j. G* _( l' `3 @ -------------------------------------------------------------------------
- L2 u3 M8 M4 V5 M' |6 W8 c, D
3 b* o# F2 c+ \+ H# I* g% H& a! H -------------------------------------------------------------
. Z, Z8 w" l0 ?( O( s Standard Condominium
% B8 `/ W; E K _ -------------------------------------------------------------9 q* A/ p O4 e( k
2-Storey 2006 Q3 2005 Q3 Condo+ Y% `5 t* s' a+ ?
Market % Change Average Average % Change
& u/ D6 n2 u" e4 @. s -------------------------------------------------------------
9 k& I; ^7 s) E# m Halifax -0.2% 142,000 103,000 37.9%( P: `; \, |8 ?% X5 g: b( G/ T4 \
-------------------------------------------------------------+ ~7 j) k7 E& |, C9 Q% A4 n( ^# T8 L
Charlottetown 2.9% 98,000 98,000 0.0%6 Y0 _- S0 H9 `5 Q# `8 n
-------------------------------------------------------------* O7 ~9 w! |( ^" H4 R
Moncton 4.9% - - N/A
9 {) d5 O3 P( c; }7 ` -------------------------------------------------------------
7 T& J% Z7 \ [0 b3 q) P Saint John N/A - - N/A4 J0 y1 X* n6 {/ p7 n) ~5 R3 ]
-------------------------------------------------------------
- U$ {9 ]; X! G' }5 H; Y: M St. John's -0.8% 146,333 145,667 0.5%
* j) b! B `& ~' L/ F9 t -------------------------------------------------------------
& i& x1 E4 J1 n1 P; X) y Atlantic 1.3% 128,778 115,556 11.4%$ i. K8 f7 E5 r6 [$ f! a1 ]
-------------------------------------------------------------, j" B, R" H8 |
Montreal 1.6% 193,190 188,016 2.8%
$ L$ [: |- B$ b9 a' B5 {. Y9 E, u -------------------------------------------------------------8 t7 e- g$ g5 b' L( a. Y1 N/ C
Ottawa 4.5% 181,083 172,250 5.1%; G) k2 h3 L) p1 b+ w' s
-------------------------------------------------------------
. O' M2 P- P- L: \ Toronto 1.4% 252,088 242,918 3.8%7 _. G! B; W( j$ g0 g p
-------------------------------------------------------------& @/ \/ }% L' r' U4 C0 N2 h
Winnipeg 12.0% 105,648 96,008 10.0%! \% B% J" W) D+ \, _3 g
-------------------------------------------------------------
: c% p2 F4 B2 W* w Saskatchewan 9.7% 106,250 101,000 5.2%8 l- W. _+ | r: P* Z
-------------------------------------------------------------
$ v- H/ s' X6 u( R Calgary 53.5% 245,844 153,867 59.8%: n8 e4 O* R' K# F' P! f
-------------------------------------------------------------
' O( X$ V; E5 B2 E0 a Edmonton 53.1% 200,433 131,500 52.4% e$ J1 V p' G: {
-------------------------------------------------------------
# N1 J5 H5 v$ M% f) V+ a G. N2 { Vancouver 13.8% 366,250 323,250 13.3%0 u* J/ F+ {. s8 t) Q- N# F
-------------------------------------------------------------* \6 F, ^% T) X/ _8 C3 t* Y
Victoria 3.1% 229,000 220,000 4.1%/ M& H8 M4 }" w) U3 }
-------------------------------------------------------------! w, }/ v: l/ g" K, u
National 13.2% 211,562 185,296 14.2%
" }3 w! z" d7 O, p -------------------------------------------------------------
4 h8 }3 e* {- d >>
3 o9 V3 d: W( Q( F4 U: d- Z! n2 P
9 l- C! t0 {0 P* x# M7 y Average house prices are based on an average of all sub-markets examined
( X+ W9 W. Z% q) h% Ain the area, except for the smaller markets of Charlottetown, Moncton, Saint" x3 b8 K" Y5 p
John and Victoria.2 a1 b3 \& s" j- r' m0 f9 X
4 z- Y, W( o& A$ e& t
The Royal LePage Survey of Canadian House Prices is the largest, most; t5 ^; F* n, @) Q
comprehensive study of its kind in Canada, with information on seven types of
" T0 {, z) D1 fhousing in over 250 neighbourhoods from coast to coast. This release
! ]7 K& x( D) Oreferences an abbreviated version of the survey, which highlights house price. v/ I! [% {! A h* |8 l
trends for the three most common types of housing in Canada in 80 communities
: Z4 A1 K# N7 m. e }: s+ _across the country. A complete database of past and present surveys is1 u, R% ] c( t4 `6 O
available on the Royal LePage Web site at www.royallepage.ca, and current; N; A j2 S' W
figures will be updated following the end of the third quarter. A printable
' r+ U. q. H5 X" G# o( J/ O; l( tversion of the third quarter 2006 survey will be available online on, d; V4 m. d; I( c9 A
November 15, 2006.
. g" @8 H# f% j Housing values in the Royal LePage Survey are Royal LePage opinions of/ p% W# R4 A0 U# P# D9 X) L$ e& b# Q
fair market value in each location, based on local data and market knowledge
- l4 X" u! g7 r4 l2 l$ X) ^provided by Royal LePage residential real estate experts. Historical data is
' T6 O# [1 M9 E3 c* g1 c/ x7 x0 [available for some areas back to the early 1970s. |
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