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Canada's housing market both vigorous and stable
2 }# q M, Y/ W
8 @$ F5 H! ^ i- {# H1 \- Country's market poised to show growth throughout 2006 -
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TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market5 }$ q( @/ \& @# ~
exhibited moderate price increases and stable unit sales during the third4 @. v: y7 L4 Q; P5 A5 w
quarter. Wide regional variances continued to be the dominant characteristic
- Z' `! z. Z, h+ q5 Gin the market, exemplified by frenzied levels of activity and double digit! B2 U7 `' Y% `. L
price gains observed in the energy and commodity rich Western provinces, and4 l& q8 b' D |! R- |/ x4 W
more reasonable sales volumes and moderate price appreciation in Ontario,
: H5 N0 w& S8 {Quebec and Atlantic Canada, according to a report released today by Royal
! |1 F, z( R3 c ?7 y5 jLePage Real Estate Services.
# m/ x1 I* Q: F* y0 h+ u- h2 |9 u/ Y; R
Nationally, market trends established through the first three quarters! c& K7 \) ~7 U* K' j7 A
are forecast to continue for the remainder of the year. Robust economic
N! j' t: [- w& Yconditions, low unemployment rates, modestly growing salaries and wages, and
) F& y, Q( M/ Jsound consumer confidence contributed to the overall strength of the
( |* `5 {; t: _4 Xresidential real estate sector." W6 | d0 J' N( M( l" P
$ G2 y: J" H" Q, E
Of the housing types surveyed, the highest average price appreciation' b" ?$ I3 M4 C$ N
occurred in detached bungalows, which rose to $300,365 (+16.3%)7 o' G" n/ [; B) t# e1 B
year-over-year, followed by standard condominiums, which rose to $211,562
' l7 _, |+ L+ F5 D/ Q(+14.2%), and standard two-storey properties, which increased to $365,380
. ^( ^) c. j/ v# V, f, A& A(+13.2%).
4 R5 a+ d$ Y0 T& K! ?) _2 T# o6 ^
: r8 O' c# F/ B# J "Canada's sturdy housing market continued to demonstrate steady growth
9 F; G, U8 y. Bduring the third quarter. For all but the west, we have moved on from the
# S1 ~2 @4 s! c0 ]4 }! H( e7 l$ Sfrenzied expansion that characterized the first half of this decade, and are
; X' |% c, D( K8 u/ @poised to show continued growth at a more moderate pace," said Phil Soper,
. u2 s$ y; g1 u, l) Vpresident and chief executive officer, Royal LePage Real Estate Services.
6 i: M& ~ T# Z6 ?: Y! A"Gone is the sellers' market that we have lived with for some years. We4 y- T0 ?1 b! I' _
welcome the more reliable conditions that are characteristic of a healthy! T0 |+ s$ }; A7 n7 z7 @
balanced market.": L" |+ e4 I s
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Despite the double-digit rise in average national house prices,
& j( Z6 k9 G, W! C& rconsiderable regional variances were exhibited again this quarter. The shift) I) X( w. y! A9 d: p! y0 z6 }
to balanced market conditions, which began in late 2005, has continued
, n5 l: x9 v7 p6 f/ Q$ }. jthroughout most of the Central and Eastern regions of the country. In the core7 b) U2 F, t2 A. e- `8 Z
energy producing western provinces, the combination of very high in-migration,
9 Y, b1 G1 F7 K7 \1 R0 I3 P C2 [* [manageable affordability, and a shortage of inventory has driven record
[% ?' Q( V R9 Zbreaking price appreciations.
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& J' A+ w0 L; N+ M* [ Echoing the second quarter and supported by Alberta's rapidly expanding6 W8 s7 d( ~$ a! q0 h
economy, Calgary and Edmonton led the charge of Canadian cities with the w! J5 |5 j% q/ ~
largest house price appreciation in all housing types surveyed.
( B* w; x; ~# y4 Z# u1 V; w% o, \! }
2 E" k, G( g/ q# H In Ottawa and Toronto, growth remained steady, supported by solid3 a# N4 F7 W% z1 {# q0 W. U" U
economic fundamentals, an increase in available inventory and strong consumer
, x% x ?* T4 h5 D. aconfidence. While the pace of price appreciation in Ontario leveled off
( R |; e$ U! d6 f3 Islightly, the province's real estate market remains poised for modest growth.
+ z H* E3 f3 h! B0 nIn Atlantic Canada, new housing and condominium construction offered buyers
2 z3 j+ Y4 p% p: Igreater selection at more competitive prices, resulting in a slower rate of! q8 @: g/ _2 O( C
price appreciation when compared with 2005.
. {" u+ [( y8 Z2 Q" m% W
& N6 }; o" Y" c% |% [1 C+ t While the pace of growth in Canada has slowed, the domestic housing$ P7 z" R2 O# h2 I
market is expected to outperform the American market. The economic and: j9 H4 z: R5 e K: Y
financial fundamentals driving the residential real estate sector in Canada+ X: F0 ]6 C7 _
are markedly different than those found in the United States.; G% @) s6 ~! p/ ]7 @5 M- `
" j! l0 }9 N: w" N. |% b7 b Added Soper: "Canada's housing market is likely to outperform the
* z2 a4 Y" ]) y( l9 XAmerican market through 2007. A number of factors are working in Canada's( K/ U5 O) y8 s( f
favour, including healthy personal and governmental debt levels, the* i+ v c1 K' |% w# I! m
relatively modest rise in interest rates in our country, and general$ R; x- \: e, V8 a7 W/ ]
affordability in our major cities. In addition, Americans are now seeing the; ~. f) S# {( _. H$ c }* g
downside of a tax system that encourages maximum homeowner leverage, and* J* g$ r6 r) }2 w. X$ v# }8 { [0 P
aggressive financial products such as zero- and negative-amortization
& H1 j5 Q+ u/ X5 m7 Omortgages that work only in a high price growth environment.": V. y% V& m6 e% p* R
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<<
9 S* G, n- n& w1 J! [6 E REGIONAL SUMMARIES) Y! Y# r$ Z5 q
>>/ z4 p) B" U8 u$ T
0 Z1 U; H5 M. V Balanced conditions continued to characterize the housing market in
* v9 c- \9 n- q. V8 P8 C6 pHalifax, as significantly higher inventory levels helped to moderate the rate1 n# J% K/ r6 C- ]
of price appreciation. Buyers were increasingly choosy, taking more time# B7 x% @/ a) T4 @+ H" {* y
looking for newer, low-maintenance properties that were not in need of3 r5 M( i1 R0 g4 S
renovations.
2 w. d5 B; _9 c( P
# z, g: e" {% o$ `. C The housing market in Moncton remained healthy and strong as a slight8 H# [4 x2 ?8 w) ?5 O) e8 G% {6 }
increase in inventory helped to moderate the rate of price appreciation
% X- W O1 i/ W3 F- x: M; H0 ycompared to the same period in 2005. Activity was brisk throughout August and& z& S' x2 E' m/ T
September and is expected to remain this way through the fourth quarter.; B2 h, k- q. {, i, y8 ?5 V
' p5 ^/ e2 U- C+ k- o- _) s
The housing market in Saint John underwent its traditional summer
' x3 Z4 y2 B% u) r( Yslowdown in the third quarter, with activity picking up towards the end of the
9 J0 q' Z) s$ Z9 Nquarter. The local economy continued to thrive, as construction on a new
! s" N P' q- ^/ G" L5 {* _600,000 square-foot shopping area has begun, bringing several new box stores
; y2 j0 b3 L0 S- x) G/ Oto the area. Buyers have begun seeking less expensive fixtures for their homes
' b) a6 E- A9 K: @. L7 r/ K# _and are instead opting for more affordable housing options.* v( Y! a N, ?1 n( T+ l- [
* t/ a3 v1 }9 A In Charlottetown, the housing market started to move towards balanced
3 {, h' A' h5 x- r0 mconditions, as some sellers had to begin to lower the asking prices on their7 y6 i# W* r/ l% Z7 J: [
homes to make them more competitive. Activity from out-of-town and US buyers* Q" p% i2 E( }( F7 ?
was down slightly compared to 2005, likely attributable to the strong Canadian, ]8 i+ b$ ~3 w4 i
dollar. Inventory levels began to creep up in the third quarter, providing: q2 C) T$ Z$ }! F* ` p. D# ^
buyers with more options when looking for a home.
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Activity in St. John's slowed slightly in the third quarter, particularly# H6 Z" s2 k& C) j. [
among higher-priced properties, where there was a slight over-supply of homes: Z6 }5 C9 A' c5 M3 Z! }) p# p/ }
priced over $200,000. Listing periods have increased when compared with 2005,& c- _6 X, n2 p0 f4 `
as some of the pent-up demand that had characterized the market over the last; l: S; T* i' l
few years has been satisfied, resulting in more normal, balanced conditions.1 A, d9 }5 r" Q9 w+ ^ q
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Montreal's housing market recorded modest increases in average house8 Y& L' B; _) V
prices, due to a slight seasonal slowdown in the third quarter as inventory
' Q ~4 Y& Q( r: l# z- Xlevels rose. Part of this can be attributed to the fact that many renting
9 v) y: n" k) c1 N# G3 kfirst-time buyers were motivated to close on the purchase of a home by July 1,# k9 w7 d% Q2 f
when rental leases expire in Quebec. Once this date has passed some of the
, v1 x" R1 I8 s* X% G* Ipressure is taken off the market, allowing buyers to visit more homes before
& V% v6 }) R! j/ J3 v" `) V p3 \6 @making a purchase.
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% L1 _# b+ x( U: H9 `0 d Ottawa held its position as one of the country's most stable housing
) _! J% p, q3 Rmarkets in the third quarter, reinforced by a vibrant local economy and strong
2 p* s# ^0 H& D2 Oconfidence, resulting in modest increases in average house prices. The city
2 d* t& v9 a% @# j h9 fcentre remained a bright spot in Ottawa, with homes in this area attracting
& a/ `. Y" ^ I$ ^attention due to their convenient location and proximity to downtown( z9 R7 n3 U+ a! |$ c8 G9 Y
amenities.& Q+ @, W) p! ?( Q- Y' e
( t% I9 O$ k. b: B6 \ The housing market in Toronto sustained healthy activity levels7 ^. l7 C3 i [* I
throughout the third quarter, as a strong economy helped to maintain demand: w. R* M/ @2 [; s0 L5 J* _$ S* u1 {! `
across the city, causing average house prices to rise moderately. Toronto has
- w7 c1 m8 _) E- [+ H2 Gcontinued to experience modest growth in average house prices, and has been" l& e6 t2 Z3 l4 a5 O; ~
driven primarily by purchasers who are buying homes as their principle" ]# b4 z+ B' g F" b/ f# M
residence, rather than for investment.
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9 k% `" h0 E6 ^9 }2 p0 _/ @ The vibrant Winnipeg housing market continued to show its strength as
% H1 v) E. d$ v: W/ A7 Fhouse prices rose during the third quarter. The booming local economy resulted1 a5 W& F3 a% r" b! Y6 ~" x+ h, M
in a historically low unemployment rate, helping to bolster consumer* f! J7 M% T- c# o/ |( s
confidence and Winnipeg's ranking as the city with the lowest capitalization
, i5 {. d0 O$ R8 ]5 n( Y! trate among the country's larger cities - helped to encourage buyers to enter
: n/ A! V# ]% ~+ e% j6 O u0 dthe market.
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In Regina, the market experienced a slight seasonal slowdown through
$ l, q( N- p) r; |July, as there were fewer purchasers in the market due to summer vacations. In
- k+ D) r, U* l+ X, LAugust, activity resumed to the busy pace previously seen in the spring- _/ G h8 n# w( |" j$ S: B& C
months, as the influx of purchasers made it more difficult to find a home due
. Y5 G; s8 j* e5 S7 b. Q3 b3 ?to the shortage of available inventory.
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1 {# M1 p* L" W6 b) e' @/ b& I2 J Activity in Saskatoon remained brisk as the market maintained its
+ N m; b" B% U) w2 ]5 gmomentum from the busy spring sales period. The economy in Saskatoon remains5 j; R. \7 Y* w* |+ x/ d) R
vibrant, as employment opportunities are abundant with many businesses: a. y5 v8 S; X1 G. {
struggling to make hires and having to recruit outside the province.
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Calgary's housing market recorded blazing average house price increases1 }7 C. B* G' }+ |' v
in the third quarter, in all surveyed categories. The burgeoning economy, low
& Q$ H5 o& `: Q% m* Kunemployment rates and low inventory levels remained the leading factors that; i' \' A5 g% X% }
pressured Calgary's house prices upwards. However, regardless of the soaring
& o5 _! p& c+ Q+ ?/ Nprices that characterized the market - even during the typically slower summer! C! ]4 w3 b p# X5 h- V
season - it is expected that activity will become slightly more balanced, as
. g; p, T& r b ]& F2 P; n' ]! Ubuyers are becoming more reluctant to participate in the frenetic activity.* N" r1 l- O9 T' O
1 \7 S& s1 U9 p; y" L, B Edmonton's booming local economy continued to thrive in the third quarter
) `2 ?5 q- K0 a/ M$ T0 ~as activity in the oil sands north of the city continued to flourish. Edmonton& V' v$ N% u0 Z2 C- I: E
remained the hub of activity for those coming to work in the oil industry,+ v% g5 u6 o) B" N+ i i
maintaining tight inventory levels across the city, resulting in prices
/ D9 r. g3 C( _9 B- }increasing at record levels. However, as inventory levels continued to improve7 p# r4 B% {- @* g2 S) ]
in the third quarter the rate of price appreciation should moderate slightly
) o- a" n2 b' _8 \towards the end of 2006. 7 Z9 Q2 W! ~# k: E4 H1 u
5 k+ c. E8 `* n+ Y% d4 H( |While Vancouver has seen a slight reprieve from the severe shortage of' |& r j1 l6 ?, R% R; X
inventory that had previously characterized the market, supply is still unable8 `# _/ h, }0 t: ^
to meet demand, driving house prices upwards. Vancouver has a very diverse
$ @4 I7 O% D* t3 L- N/ bgroup of active buyers - from first-time home buyers to baby-boomers to. }& m3 ]( o( r0 ~0 f: T
foreign investors - all of whom fuel the demand for houses, placing added
. ~* s0 p7 \: o( _; {1 apressure on tight inventory levels.
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T6 z5 Q1 M# E! @* M7 x% ~ Victoria's market is vibrant and supported by strong economic5 j8 ?% y9 p0 O& D1 L3 w' {
fundamentals, fuelled by a booming tech sector and a migration of young people
2 Y5 j- h. p" s' Y6 {( V; i9 h" Linto the city that has continued to support the area's house price increases;% U6 G: B1 K9 P6 `: Q' @ X7 a% ^
while increased inventory levels have afforded buyers more time when searching9 V: X# o" X1 F" ~& e1 o# R
for a home, helping to normalize the market's pace.
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<<) Y. j: @3 Z2 @" W$ K6 `5 u' B) E, V
Survey of Canadian Average House Prices in the Third Quarter 20064 Y' P- B8 ]5 _, `
2 e9 s/ n6 ?% ?. o& `4 S" `8 k -------------------------------------------------------------------------2 b7 u: X0 Y: l5 s" ]3 h) k
Detached Bungalows Standard Two Storey
# G, D1 G* z* l -------------------------------------------------------------------------
7 H+ X% C6 o6 t1 g: g 2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3, {( W3 T! T: {% j6 i
Market Average Average % Change Average Average% |2 n4 @! B5 [3 |. g
-------------------------------------------------------------------------+ |% S- ^( |7 Y7 n
Halifax 186,333 173,333 7.5% 198,667 199,000! r; U' O) J1 v3 w9 N
-------------------------------------------------------------------------
' w8 G) d3 ], _1 w7 i. H5 u Charlottetown 145,000 141,000 2.8% 175,000 170,000
( p; L/ V& y' |$ ^ -------------------------------------------------------------------------9 [% s) a2 ]7 }4 c; j. ?2 Z
Moncton 135,000 127,000 6.3% 129,000 123,000% q, j4 \3 h; A" y3 p6 ^
-------------------------------------------------------------------------# v8 c, U8 I4 {. F% \- j
Saint John 141,200 142,900 -1.2% - -7 S4 o! c8 D6 r+ L
-------------------------------------------------------------------------
6 w8 y0 T3 q% A" T* i St. John's 143,667 142,667 0.7% 200,667 202,333! \& V" E* A% q8 @/ S
-------------------------------------------------------------------------; }- V5 t" {$ @5 L4 A1 r
Atlantic 150,240 145,380 3.3% 175,833 173,583. }1 e7 G6 n9 W0 r }% \
-------------------------------------------------------------------------4 M9 U) L( W# M/ }3 z1 |; @6 y G5 w
Montreal 213,691 203,500 5.0% 321,141 316,185
5 N7 O1 y" I: r5 c3 m4 v -------------------------------------------------------------------------8 W2 a; j- |9 ]: N* @. ?1 s2 ^
Ottawa 290,083 278,417 4.2% 285,667 273,250; K( N- \* O9 x/ K. H& y5 }
-------------------------------------------------------------------------
' Q8 X) n, o$ P) a6 _0 ^" i" _3 `' x Toronto 373,368 355,882 4.9% 481,523 474,766
0 m) J% x* ~6 Z& f -------------------------------------------------------------------------
6 R+ y+ `, u7 t6 L8 X" R! o Winnipeg 181,579 159,860 13.6% 202,337 180,707$ Q( }! c- W- p% K! a# S
-------------------------------------------------------------------------
% j$ r, ]) l% G( n3 q Saskatchewan 170,667 156,083 9.3% 182,600 166,500
( d- @' l, _( H& b* L -------------------------------------------------------------------------
3 u( J9 q$ V) K# }( o2 I& U+ A0 ~ Calgary 395,067 252,411 56.5% 405,778 264,389' w p' b, R) m0 k i
-------------------------------------------------------------------------
/ O4 S/ Q `" Z) }+ I! ] Edmonton 286,857 194,857 47.2% 316,429 206,7140 A5 t {/ W1 p+ t- o
-------------------------------------------------------------------------
3 R9 ^; |( m4 [- v2 O; a Vancouver 704,250 601,000 17.2% 794,000 697,500
% a+ G2 x7 |- f+ `% s5 Q -------------------------------------------------------------------------
# q, W) P2 r! h4 Y1 S3 T/ L Victoria 375,000 348,000 7.8% 403,000 391,000, ]! K( j) v' t! F7 F/ K8 _3 Z: P9 X
-------------------------------------------------------------------------
2 `' E' E" d' C, _: Q8 ~. E/ m National 300,365 258,202 16.3% 365,380 322,860# o9 q H# C3 T
-------------------------------------------------------------------------
3 t! z3 }) }) j8 F- }- S
" v& D5 |" ^; V# ? H, ] -------------------------------------------------------------
; f/ Z& Z% X- Y" `: p- @& v Standard Condominium8 u, B b' D6 X4 d( I
-------------------------------------------------------------* ~( ~) ?% V8 \' T
2-Storey 2006 Q3 2005 Q3 Condo& `- \& x0 Q0 R; U: }
Market % Change Average Average % Change
3 x. o" B% T4 ]+ a -------------------------------------------------------------
* z; o- R1 Y; j! R Halifax -0.2% 142,000 103,000 37.9%
+ g9 i: a. l6 E+ _' u -------------------------------------------------------------
; l4 O1 C- o1 ]7 f* s Charlottetown 2.9% 98,000 98,000 0.0%
; \7 ^8 e- Y( _ -------------------------------------------------------------
' M J) o6 w) q" W4 P Moncton 4.9% - - N/A
9 X5 [& b. @' v7 }- l -------------------------------------------------------------
5 Y: Q* s6 J. B4 l; q Saint John N/A - - N/A+ F! e: I4 o1 K. N! _* w* L
-------------------------------------------------------------6 Q' e( k. L2 {: n7 N& Z) C5 Z
St. John's -0.8% 146,333 145,667 0.5%
7 W8 ^/ b& U' A -------------------------------------------------------------
! c% H+ {# s; H; B" A Atlantic 1.3% 128,778 115,556 11.4%2 z! C* c a3 |$ \5 O
-------------------------------------------------------------
8 T+ P1 q- E! p+ ?# I# f" h Montreal 1.6% 193,190 188,016 2.8%9 _$ L) V0 A$ Y! H6 C+ V
-------------------------------------------------------------7 e p" j3 R5 L* C/ h9 w
Ottawa 4.5% 181,083 172,250 5.1%
, O( t) M+ I. |$ j [ ------------------------------------------------------------- P h2 R" H* @) ~
Toronto 1.4% 252,088 242,918 3.8%
. h0 J4 i4 i. Q L- I$ \% L t -------------------------------------------------------------. n) _. X/ C" b! i2 y3 \( r
Winnipeg 12.0% 105,648 96,008 10.0%
2 M: p5 G1 x- d7 P4 _. J -------------------------------------------------------------
% a! N4 K( \/ ?" n' J3 K/ E4 u0 ? Saskatchewan 9.7% 106,250 101,000 5.2%, t$ N$ [: E8 u+ D9 N. V. F2 z
-------------------------------------------------------------
1 m: o) j. M# s$ L. s Calgary 53.5% 245,844 153,867 59.8%- ^4 M# q8 d% R( O) }4 ~: ^" t
-------------------------------------------------------------. X% a: ?% B% Z
Edmonton 53.1% 200,433 131,500 52.4%6 d( U- ~$ e; Q/ y: @
-------------------------------------------------------------* B; m5 b2 j8 r$ i4 W
Vancouver 13.8% 366,250 323,250 13.3%
6 W: [8 |" n: E+ w# m+ t' u -------------------------------------------------------------
% m* |* X2 r" T/ E( u! } Victoria 3.1% 229,000 220,000 4.1%
0 y- n/ |4 ^, [: S% K: z -------------------------------------------------------------2 {1 h @. Q2 j1 K) `
National 13.2% 211,562 185,296 14.2% G0 x* I! f5 e8 `9 f
-------------------------------------------------------------4 ~! E D: C7 ?: T) z
>>% y! t) x; x) ^5 S
* n6 M8 w+ J( G. D; O& `( q$ z
Average house prices are based on an average of all sub-markets examined
1 s+ K c& s. ]& W! m+ M7 _. bin the area, except for the smaller markets of Charlottetown, Moncton, Saint
|/ M% V- m1 Z5 [John and Victoria., E5 x3 s" P6 n# L2 s
7 k5 Z( i, g3 k/ T" O2 G2 @& p! r The Royal LePage Survey of Canadian House Prices is the largest, most
7 l) V- F' g/ I$ B! [comprehensive study of its kind in Canada, with information on seven types of
7 ~3 ]! S( Q; ^: i; P+ @housing in over 250 neighbourhoods from coast to coast. This release
* d' f8 i" [0 _- K$ K1 d+ sreferences an abbreviated version of the survey, which highlights house price' Y0 O# D% M1 B, G
trends for the three most common types of housing in Canada in 80 communities+ A1 [: u& x* M
across the country. A complete database of past and present surveys is6 T* \ U& x) \4 q& w
available on the Royal LePage Web site at www.royallepage.ca, and current
/ K: Y/ C0 d0 v6 P8 dfigures will be updated following the end of the third quarter. A printable
# }- Q, }: M+ V9 Lversion of the third quarter 2006 survey will be available online on
: A9 C+ c& X6 `' }2 C9 kNovember 15, 2006.% \/ E5 Z) r- j: s5 P: W
Housing values in the Royal LePage Survey are Royal LePage opinions of
: Y$ f5 z$ q/ d1 N3 mfair market value in each location, based on local data and market knowledge
. [2 ~9 o# u a7 z9 _7 \$ Vprovided by Royal LePage residential real estate experts. Historical data is
1 e$ j7 ^4 P5 zavailable for some areas back to the early 1970s. |
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