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Canada's housing market both vigorous and stable
9 A5 h) f; s6 \1 [3 i- z" _6 [: Y. Y+ D
- Country's market poised to show growth throughout 2006 -3 V0 N8 |4 t0 }2 z
* g+ O( a' o3 [ TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market8 D' {% ?/ v- `) ~) |& B: D' D) U- `
exhibited moderate price increases and stable unit sales during the third' Y; R& E. L t: h0 a7 N& x
quarter. Wide regional variances continued to be the dominant characteristic: m/ w6 T! G B$ ]
in the market, exemplified by frenzied levels of activity and double digit6 b$ Y+ p* Q6 h$ ~- b
price gains observed in the energy and commodity rich Western provinces, and% o3 Z2 W* W5 T+ C# D( n8 X8 Y5 e6 H
more reasonable sales volumes and moderate price appreciation in Ontario,
/ d, d% f! {7 h# z4 W8 q* W2 {Quebec and Atlantic Canada, according to a report released today by Royal
& h' q0 q; n! J; ULePage Real Estate Services.3 K' i0 X6 U. o4 }
5 A: R4 \1 }0 w& Q( G( z Nationally, market trends established through the first three quarters
+ B: M' E0 o! z( Kare forecast to continue for the remainder of the year. Robust economic
7 b! R- e( h) t3 O1 B/ X( Q8 f9 |conditions, low unemployment rates, modestly growing salaries and wages, and0 f: V3 A }1 C) Q: G- w: K
sound consumer confidence contributed to the overall strength of the% n% s$ y0 I6 n$ Y2 U. c+ B
residential real estate sector.; p# M0 Y4 u$ K# ~) M$ a& Q
# I* `* k3 Y+ z+ L; ]# O; T Of the housing types surveyed, the highest average price appreciation
) {1 R+ G. j t8 ?8 n2 }% Moccurred in detached bungalows, which rose to $300,365 (+16.3%)$ p4 S" s1 V, B4 o6 |. C" a
year-over-year, followed by standard condominiums, which rose to $211,562+ ^3 F4 v! e9 X* d% {0 e2 p8 `
(+14.2%), and standard two-storey properties, which increased to $365,3802 ^$ `) `, F6 r% B7 K2 K( G& f
(+13.2%).
5 R, e) r% j, V5 i) J B% _, O. U( ?/ u0 L, x* O, l! Y1 ^3 q
"Canada's sturdy housing market continued to demonstrate steady growth2 \. |7 x g W7 y* H% c; j
during the third quarter. For all but the west, we have moved on from the
, I: I9 j2 z" Yfrenzied expansion that characterized the first half of this decade, and are3 ~. U7 o- }6 s% e( o9 o
poised to show continued growth at a more moderate pace," said Phil Soper,; {+ J+ ~. U: \8 E9 @
president and chief executive officer, Royal LePage Real Estate Services.
6 C% ~' a" G3 c' o"Gone is the sellers' market that we have lived with for some years. We* A$ o* T! P2 G: X# Q
welcome the more reliable conditions that are characteristic of a healthy
: w' o3 Q# u# G2 f% }# y- sbalanced market."
D7 s4 Q# D* \4 j# i" v8 J2 U
* G/ h; ^& t$ a O/ u2 } Despite the double-digit rise in average national house prices, G% ^1 u) O# I
considerable regional variances were exhibited again this quarter. The shift
s% @3 S% K: \to balanced market conditions, which began in late 2005, has continued3 e7 Y8 b: V3 v% ]1 H f/ G
throughout most of the Central and Eastern regions of the country. In the core3 L8 c! j7 i4 u* N7 b
energy producing western provinces, the combination of very high in-migration,- @5 _8 j" o( L; j C/ E
manageable affordability, and a shortage of inventory has driven record
' h a' K- \: ?9 ~4 C1 jbreaking price appreciations.: p6 s- m- C8 a! O. [
$ m+ {+ Q+ V) m, [ Echoing the second quarter and supported by Alberta's rapidly expanding2 P5 S& U1 ?6 P
economy, Calgary and Edmonton led the charge of Canadian cities with the
# ]: j- S7 p# ^" r% O0 g3 Xlargest house price appreciation in all housing types surveyed.. j, J: A8 s1 d. y4 Y A
* Q6 a1 I. n' U: W7 n0 B0 S' @
In Ottawa and Toronto, growth remained steady, supported by solid
! ?4 Y: O4 \9 eeconomic fundamentals, an increase in available inventory and strong consumer1 R* |7 @. C1 Y( H2 _
confidence. While the pace of price appreciation in Ontario leveled off
! Y; Z+ Z) s8 K) f' \6 r7 @slightly, the province's real estate market remains poised for modest growth.
4 W. v _! V6 hIn Atlantic Canada, new housing and condominium construction offered buyers
& R) G( K! K& F$ c/ _greater selection at more competitive prices, resulting in a slower rate of" l3 e! q$ F- x$ K0 a
price appreciation when compared with 2005.* a7 N2 g _+ g* s' J" D
' J- L) a+ r) q' l
While the pace of growth in Canada has slowed, the domestic housing
N" B6 r8 K- p) e, s0 Bmarket is expected to outperform the American market. The economic and; I+ D% N# I3 @7 u5 D4 B- [8 L
financial fundamentals driving the residential real estate sector in Canada
' {5 D1 Q* A% W, [are markedly different than those found in the United States.
% |" C0 U% G |7 X9 z4 F
5 K( D" A. a2 [) ^8 g0 @ Added Soper: "Canada's housing market is likely to outperform the% h" V* w/ [6 E" L9 k8 i o
American market through 2007. A number of factors are working in Canada's
8 _4 W2 i0 U) dfavour, including healthy personal and governmental debt levels, the
4 g, z9 ~9 f8 Grelatively modest rise in interest rates in our country, and general- s7 t1 S, k; \
affordability in our major cities. In addition, Americans are now seeing the" q M( h9 g5 ~% D Q6 ~. |1 }
downside of a tax system that encourages maximum homeowner leverage, and
. V. @% P( {/ O Waggressive financial products such as zero- and negative-amortization3 w& u! P& _0 r' _; H9 a
mortgages that work only in a high price growth environment.". A( |% d: h5 s. Y9 L; e5 T, W
1 O( u9 n' C6 `. I7 o
<<
# M. _4 n( V0 _) ]+ Y/ G' r$ f REGIONAL SUMMARIES. C4 _. I( Y0 a! B& K/ e
>>' X% ^4 }& x- u
N5 ]1 r* D: ~/ V! T5 S Balanced conditions continued to characterize the housing market in6 E( T0 v& O, i6 b
Halifax, as significantly higher inventory levels helped to moderate the rate7 K/ D, Q+ j3 f2 f
of price appreciation. Buyers were increasingly choosy, taking more time8 _5 `- n' V1 c/ E4 |
looking for newer, low-maintenance properties that were not in need of$ a5 W$ p2 @1 I+ V( c
renovations./ e5 J T( D+ }9 x
* Q4 L2 B$ Z% x n9 X7 o2 M8 l- ~3 k8 _ The housing market in Moncton remained healthy and strong as a slight
0 z5 L# l2 s3 Z" I" d8 X" Vincrease in inventory helped to moderate the rate of price appreciation
6 I; E' v% n; Ecompared to the same period in 2005. Activity was brisk throughout August and
: i) m3 @2 ^5 z5 ` s, H5 z# ^September and is expected to remain this way through the fourth quarter.5 p k( z+ D; t
@; k( l5 l5 `4 G& K! I
The housing market in Saint John underwent its traditional summer
/ D, F! j* c: Lslowdown in the third quarter, with activity picking up towards the end of the/ S: }( ~+ }' i/ r' O
quarter. The local economy continued to thrive, as construction on a new
1 Z+ _* {8 ~" [600,000 square-foot shopping area has begun, bringing several new box stores
) c2 Q! b' R4 ~6 ^- `7 |to the area. Buyers have begun seeking less expensive fixtures for their homes6 C) d" g/ C( Q) S3 Q
and are instead opting for more affordable housing options.9 z( y2 V% j- [
& d, o- P) d: k% m In Charlottetown, the housing market started to move towards balanced
0 {- X' D& K, F, Fconditions, as some sellers had to begin to lower the asking prices on their9 f- J2 [+ u7 z1 K; z& q& R6 M
homes to make them more competitive. Activity from out-of-town and US buyers% C0 @3 R. \5 s0 H+ l0 M% j
was down slightly compared to 2005, likely attributable to the strong Canadian0 l/ W( @+ c: U# I; a4 z. A
dollar. Inventory levels began to creep up in the third quarter, providing
. v8 ~' i2 O4 M; ]8 v$ {9 nbuyers with more options when looking for a home.6 l# V. }, p. V5 j' z& _5 H
9 `! U! `3 i+ @0 N. V2 w3 g Activity in St. John's slowed slightly in the third quarter, particularly
) r, x" |% h6 G0 o8 C4 }9 ]" damong higher-priced properties, where there was a slight over-supply of homes7 S* w, X, c, K, h
priced over $200,000. Listing periods have increased when compared with 2005,
7 e* @" |0 s9 I vas some of the pent-up demand that had characterized the market over the last3 ^) G/ R' D5 @1 F+ X( L
few years has been satisfied, resulting in more normal, balanced conditions.9 e7 O0 g3 y% O
% O( |) Y9 `' V4 l! x# h
Montreal's housing market recorded modest increases in average house9 p& e- m& L' D _$ d7 p7 T
prices, due to a slight seasonal slowdown in the third quarter as inventory" z, M* O+ l9 j$ D$ Z
levels rose. Part of this can be attributed to the fact that many renting6 Z9 O- Z# Y5 [2 ]1 U; c1 p F4 ~
first-time buyers were motivated to close on the purchase of a home by July 1,
4 ?0 L/ m9 ^' r0 r. C9 Awhen rental leases expire in Quebec. Once this date has passed some of the
9 B7 n( Q: r. V# M/ w$ jpressure is taken off the market, allowing buyers to visit more homes before
: t* Q* F& J$ Q# I/ B$ ` _making a purchase.
1 f* }( ~4 u ?" V5 m
+ E* w" Z7 T- y/ u1 x4 W Ottawa held its position as one of the country's most stable housing# q- o) d1 O, X+ s
markets in the third quarter, reinforced by a vibrant local economy and strong) ^8 B* \$ C0 r5 o$ C1 Z: r
confidence, resulting in modest increases in average house prices. The city9 g, ?3 n- L' Q2 q: x
centre remained a bright spot in Ottawa, with homes in this area attracting% J' ` _) ?. I& Z0 F* k
attention due to their convenient location and proximity to downtown
9 F, F* k9 w# O% Vamenities.4 V2 A/ Q8 l' |
! i) P% N" w2 p( Q+ ^2 W0 u The housing market in Toronto sustained healthy activity levels
# e, k$ V$ E6 lthroughout the third quarter, as a strong economy helped to maintain demand
6 L$ B7 A2 w/ z( x [: H0 jacross the city, causing average house prices to rise moderately. Toronto has( x; v: @1 A/ ?
continued to experience modest growth in average house prices, and has been
* x& t" l! L! w/ H4 @% A1 hdriven primarily by purchasers who are buying homes as their principle8 B2 `7 f( _* A9 A
residence, rather than for investment.
7 F& \, W }8 \! L2 `
$ J3 m; B4 ` b3 o6 h1 l The vibrant Winnipeg housing market continued to show its strength as
) S2 C' M7 s" u! q; Q& Z" qhouse prices rose during the third quarter. The booming local economy resulted
9 ~# M2 [5 M" }" @6 P$ h$ h) bin a historically low unemployment rate, helping to bolster consumer8 ^' S* x* ~& z# q4 B. Y
confidence and Winnipeg's ranking as the city with the lowest capitalization
/ j( D) w4 J1 v8 J; ^8 q; Krate among the country's larger cities - helped to encourage buyers to enter
" I: M* t9 s; }9 Rthe market.6 Z- c% x7 V! ]& l
& S- G J! V" [ In Regina, the market experienced a slight seasonal slowdown through# q% [7 d9 C% \% Q B
July, as there were fewer purchasers in the market due to summer vacations. In
& }* W' u& A" {8 F, L/ ?August, activity resumed to the busy pace previously seen in the spring3 ?* \& ]( n3 W6 I/ c7 P* H
months, as the influx of purchasers made it more difficult to find a home due1 d6 K$ g# z! _, ~
to the shortage of available inventory.) z( k0 T) j- U& _0 }
7 b, \% {/ r: U6 l$ F Activity in Saskatoon remained brisk as the market maintained its6 @% Q' W! k) f
momentum from the busy spring sales period. The economy in Saskatoon remains
+ `$ J- g: F' uvibrant, as employment opportunities are abundant with many businesses
, D$ f) a# P A2 [+ w+ {struggling to make hires and having to recruit outside the province.& l0 p# b1 B. m' Q
0 O1 A- j' I) \! `' U# }" Z0 u Calgary's housing market recorded blazing average house price increases- x8 i, n+ p* M- u. D2 K
in the third quarter, in all surveyed categories. The burgeoning economy, low
) j- K( z) j, N a+ d7 w5 Dunemployment rates and low inventory levels remained the leading factors that. }0 v! U9 W8 F% x1 A4 Q3 {/ {
pressured Calgary's house prices upwards. However, regardless of the soaring
0 |% g) P* \3 Rprices that characterized the market - even during the typically slower summer6 X: [9 [* E/ q, G( H5 X
season - it is expected that activity will become slightly more balanced, as$ ~6 ]2 g7 Q- b/ K' V0 C. D
buyers are becoming more reluctant to participate in the frenetic activity.
) y" ?, x1 q- W& L! i
3 |" t. A* h. Z0 X Edmonton's booming local economy continued to thrive in the third quarter
$ b& j8 Q$ a+ j3 d4 X/ O% m1 Las activity in the oil sands north of the city continued to flourish. Edmonton
8 N- _2 g4 m8 @; o. |0 hremained the hub of activity for those coming to work in the oil industry,1 b; \, P- `+ S6 v( H
maintaining tight inventory levels across the city, resulting in prices
0 h9 \- |+ u1 }$ s; Xincreasing at record levels. However, as inventory levels continued to improve: X: r% w/ ~& _- I5 ?% y
in the third quarter the rate of price appreciation should moderate slightly
7 a X u4 q9 Z7 f* g5 gtowards the end of 2006. ; c% q% I2 C! U5 @
+ Q( e) R7 N$ D) r8 ]/ j8 ]- U
While Vancouver has seen a slight reprieve from the severe shortage of
" r( |4 t: h5 y$ Z6 hinventory that had previously characterized the market, supply is still unable* {4 T; N. ]# m) z% _) c6 F! ?
to meet demand, driving house prices upwards. Vancouver has a very diverse
) y2 u9 B' n2 O2 E& Wgroup of active buyers - from first-time home buyers to baby-boomers to
7 l$ p; K1 t3 C% J( V3 ^9 Cforeign investors - all of whom fuel the demand for houses, placing added3 X2 d/ e# P) X% ^# {" D
pressure on tight inventory levels.
9 s# v l6 [7 f& ^1 m
. a2 ]: q j# c- Z+ h( {3 l Victoria's market is vibrant and supported by strong economic
0 H0 d* O- O% I, C! ?3 _fundamentals, fuelled by a booming tech sector and a migration of young people
; q! H8 ?. n j1 t* x6 Qinto the city that has continued to support the area's house price increases;* h0 a/ P4 f0 B. T$ t) h
while increased inventory levels have afforded buyers more time when searching
% d; n$ [# T8 P5 Tfor a home, helping to normalize the market's pace.
% }# x7 f' D1 X* P, w5 a6 n
8 \. x+ ] T3 ?* \2 g C <<
8 @ X# _& }' y3 B8 a Survey of Canadian Average House Prices in the Third Quarter 20063 Y7 M& @/ p/ ] ^
( m5 V" K/ ]- B9 Z0 E2 Y
-------------------------------------------------------------------------
% m5 V! k4 L/ G& ?, {; q Detached Bungalows Standard Two Storey
6 {+ w; W$ |/ O2 {8 b' n -------------------------------------------------------------------------
, b( s' M+ o0 e k; |- ^' x7 ^( v 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
$ ^( q- p5 c. V( I& P, k Market Average Average % Change Average Average# P# _$ |$ l0 @9 O" _) C' N
-------------------------------------------------------------------------
+ X# `4 F8 p U% L: `6 { Halifax 186,333 173,333 7.5% 198,667 199,0006 }/ B' z% D$ i( {, {4 K. m
-------------------------------------------------------------------------. S# z; ^9 m, L
Charlottetown 145,000 141,000 2.8% 175,000 170,000
. x( c, s3 ]. m% w2 C! t -------------------------------------------------------------------------* c l& O) \( ], p' k- ]
Moncton 135,000 127,000 6.3% 129,000 123,0006 A3 V* f* d+ w7 W5 L# ~
-------------------------------------------------------------------------
$ p! J& b0 Q! K3 L# X0 T Saint John 141,200 142,900 -1.2% - -
* t; v# P3 W, Z6 m -------------------------------------------------------------------------
/ _/ G# C& ^1 e1 `) q St. John's 143,667 142,667 0.7% 200,667 202,3333 {3 N |8 h6 m- D6 D& @2 v
-------------------------------------------------------------------------
0 e/ _. Y; Q2 n Atlantic 150,240 145,380 3.3% 175,833 173,583
% R6 J; e* h7 D# M2 h/ I- n" u7 w -------------------------------------------------------------------------3 |6 p8 w. f( H3 ?
Montreal 213,691 203,500 5.0% 321,141 316,185
, T0 k) a. {; }( \$ L" ] -------------------------------------------------------------------------
$ b1 c9 q- }+ k; P' w! a Ottawa 290,083 278,417 4.2% 285,667 273,2509 ]2 B" E! O% ?7 p0 i
-------------------------------------------------------------------------
; e# @# U, e/ p& d9 I# _' Z' F Toronto 373,368 355,882 4.9% 481,523 474,7663 u) c+ f4 S/ \$ R3 }" w/ g4 c
-------------------------------------------------------------------------
4 Y% x, J+ H+ T! O5 A+ ]4 Q+ ^ Winnipeg 181,579 159,860 13.6% 202,337 180,707
; s9 I9 Q8 ]/ _/ }) l3 r% _( A P -------------------------------------------------------------------------
. Z @ X$ N* w# ^) V; g% C Z1 t Saskatchewan 170,667 156,083 9.3% 182,600 166,500
% j$ O. D6 ]9 f" c7 v; n7 v( E3 E7 x -------------------------------------------------------------------------! @0 |6 x* J5 i; G- a
Calgary 395,067 252,411 56.5% 405,778 264,389# |7 t( \; u/ f v
-------------------------------------------------------------------------9 T o5 F' @0 Y' ^ j
Edmonton 286,857 194,857 47.2% 316,429 206,714
4 G( R. [3 G# e" p6 S5 s# K -------------------------------------------------------------------------! U: C5 }' g( b$ N
Vancouver 704,250 601,000 17.2% 794,000 697,500
; o0 z3 @* L1 k" J3 E% e -------------------------------------------------------------------------- X* p( b: h, E
Victoria 375,000 348,000 7.8% 403,000 391,000
, |) I0 J3 d0 C+ E -------------------------------------------------------------------------: V- v6 L! ^( [8 w3 \! B# U9 y
National 300,365 258,202 16.3% 365,380 322,860# N f, }( V5 X8 r5 [
-------------------------------------------------------------------------& M; `! c5 s% H8 ^
2 E& [/ K9 {! T7 \ A* F
-------------------------------------------------------------3 Y' }$ p! y( U/ ]! o
Standard Condominium0 o6 U9 X% t# D! w% K) P
------------------------------------------------------------- j) E" E; [' ^
2-Storey 2006 Q3 2005 Q3 Condo
. D2 H5 k# a$ I8 D Market % Change Average Average % Change
: c& h; o3 k% e8 y -------------------------------------------------------------
/ @$ l/ }4 }8 c& G/ l4 y Halifax -0.2% 142,000 103,000 37.9%! U" a q- ~6 C2 s( H
-------------------------------------------------------------2 i k6 b9 U- L7 |# d) O
Charlottetown 2.9% 98,000 98,000 0.0%
4 r# |# h1 q0 o) [ -------------------------------------------------------------# \1 {; E1 i! d$ `5 q# A( f( P
Moncton 4.9% - - N/A: d( d# o, D+ I
-------------------------------------------------------------0 H9 e0 N% Y; g; Q% F; g9 _, }
Saint John N/A - - N/A
! m4 i. I7 b* I; ` -------------------------------------------------------------
/ l) j8 g. J( \8 ] St. John's -0.8% 146,333 145,667 0.5%3 Y/ D% \7 v0 X8 T
-------------------------------------------------------------: H+ @& [. l- T' R1 M6 i+ O0 W
Atlantic 1.3% 128,778 115,556 11.4%
. ~2 {# ~# p1 I. l" f# i' ~- h$ T -------------------------------------------------------------0 B; c1 k% W6 r4 y; T; E
Montreal 1.6% 193,190 188,016 2.8%# w% L) L& e4 B; N, m
-------------------------------------------------------------
$ c' h) K( D$ n4 q, ~& R( L z* R Ottawa 4.5% 181,083 172,250 5.1%
6 W3 B( Q) U& v0 Q" P -------------------------------------------------------------2 I$ [( I# V6 E% A) M! w g
Toronto 1.4% 252,088 242,918 3.8%
( ~2 }% h; b* y9 Y -------------------------------------------------------------
* d$ h- X2 p( T Winnipeg 12.0% 105,648 96,008 10.0%: p! P. r: n+ n1 s* X
-------------------------------------------------------------3 O3 K1 R( H4 [
Saskatchewan 9.7% 106,250 101,000 5.2%; n p. K2 p$ E- l
-------------------------------------------------------------) \8 g. q# r! U6 X' i5 G9 i
Calgary 53.5% 245,844 153,867 59.8%$ y; B% V/ S% s8 @. d# R. A
-------------------------------------------------------------
+ K0 m( B) ]7 v, n- G# M Edmonton 53.1% 200,433 131,500 52.4%# e i" c( O! ]. r! R
-------------------------------------------------------------
6 @: v4 W6 d; f Vancouver 13.8% 366,250 323,250 13.3% I' h& E3 p2 y/ W
-------------------------------------------------------------
* {8 A. D( d' P Victoria 3.1% 229,000 220,000 4.1%
s( B) L- H2 E& e) l5 i1 Y -------------------------------------------------------------9 ]% b$ f$ c1 z+ q0 x$ @5 g
National 13.2% 211,562 185,296 14.2%
' ]- f: F. P% H -------------------------------------------------------------" I% M2 L$ E6 F% t+ o+ ]* T
>>7 m9 |1 h, f2 ?# b* i; E
7 }; Q; p- v. R! N& @ Average house prices are based on an average of all sub-markets examined
4 y2 S/ `& G/ E2 Gin the area, except for the smaller markets of Charlottetown, Moncton, Saint% E% D3 A( N5 Y% Z+ U
John and Victoria.
7 F) k' [2 D. f: A% C. | E9 X A+ M0 G: Y# E: b
The Royal LePage Survey of Canadian House Prices is the largest, most# F8 d w# O! A: \% c; v
comprehensive study of its kind in Canada, with information on seven types of
) n! u) T' N2 E1 i3 l- h7 H4 C% z, y) Qhousing in over 250 neighbourhoods from coast to coast. This release. B; k, q$ t- U- [
references an abbreviated version of the survey, which highlights house price
5 l- [3 N4 y. p6 R- ]& ytrends for the three most common types of housing in Canada in 80 communities
* G* X( ?. C5 \% W( c5 f$ A: S; Wacross the country. A complete database of past and present surveys is
4 \$ G2 C2 ^; y/ kavailable on the Royal LePage Web site at www.royallepage.ca, and current
h5 [' t6 ]$ d, afigures will be updated following the end of the third quarter. A printable2 S {# J9 \6 g5 m
version of the third quarter 2006 survey will be available online on6 V! d& y. k6 V% j: [& K+ \/ m- j1 B
November 15, 2006.4 s- q9 o0 f0 L% R
Housing values in the Royal LePage Survey are Royal LePage opinions of
$ a+ b% c q: D- o$ m, x; F" w( _6 ufair market value in each location, based on local data and market knowledge$ X6 d' c. \8 A
provided by Royal LePage residential real estate experts. Historical data is/ T2 R4 u: R& q; B# M
available for some areas back to the early 1970s. |
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