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Canada's housing market both vigorous and stable / L8 |1 s0 p& n, _( I
6 N. [" Y: |: Z( W- Country's market poised to show growth throughout 2006 -
" q" a# O4 d1 c, A+ |" ?' r5 H; `0 D' [. z+ n% G: d5 K
TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market
5 R$ r9 Y: X; I$ V6 W- h8 _exhibited moderate price increases and stable unit sales during the third
. t1 h" H) d- c3 g2 gquarter. Wide regional variances continued to be the dominant characteristic
4 N1 [; B8 f8 N9 g3 p$ Xin the market, exemplified by frenzied levels of activity and double digit
# j0 ` A7 G' g& Jprice gains observed in the energy and commodity rich Western provinces, and
+ A$ b0 ^' H# T( tmore reasonable sales volumes and moderate price appreciation in Ontario,
8 _( [; m; s* |, B9 b4 sQuebec and Atlantic Canada, according to a report released today by Royal1 T7 k. T' e) ]4 K; Y
LePage Real Estate Services.
/ O0 I0 H. P, `4 [+ q$ M7 E
# i9 M. r; Q- C9 G2 ?- i2 P Nationally, market trends established through the first three quarters; k- {5 I+ `- ~ f \& {4 ~- ~
are forecast to continue for the remainder of the year. Robust economic- m8 N! k6 k' x7 W
conditions, low unemployment rates, modestly growing salaries and wages, and
. ?, C! O8 g/ @- Tsound consumer confidence contributed to the overall strength of the
0 z& s5 q3 o. P qresidential real estate sector.
6 ^9 O7 N: x& p8 o
8 k* u# m: e7 _. v4 R Of the housing types surveyed, the highest average price appreciation
: {4 f7 m( f6 j, D8 m6 O' moccurred in detached bungalows, which rose to $300,365 (+16.3%)
/ O! x9 G# o9 h# x kyear-over-year, followed by standard condominiums, which rose to $211,562/ k0 z" h' c- g* u$ |7 b* d0 y& a _; [
(+14.2%), and standard two-storey properties, which increased to $365,3803 ~: |* l# K% Z- S" x/ X
(+13.2%).
0 `$ @" ?* z- [$ [* C) @/ k
$ B: h4 @" D* H$ g "Canada's sturdy housing market continued to demonstrate steady growth
: d* }6 p: L! q4 H7 o* ^; ?7 U+ [/ Cduring the third quarter. For all but the west, we have moved on from the
2 p7 ~+ o; r7 M7 Vfrenzied expansion that characterized the first half of this decade, and are
: C/ ?$ P& e" y* Zpoised to show continued growth at a more moderate pace," said Phil Soper, x' H; p! o* t* U/ u
president and chief executive officer, Royal LePage Real Estate Services.
7 }0 a2 F( E! D) G"Gone is the sellers' market that we have lived with for some years. We3 X. E/ H) p2 \5 @$ K
welcome the more reliable conditions that are characteristic of a healthy" `# p, ~) z7 |
balanced market.". r) g. \& w' X( @' \) Y
. \! D6 v3 c0 N: [4 y7 Y
Despite the double-digit rise in average national house prices,6 p; s1 e/ a( H; q$ D+ s2 x
considerable regional variances were exhibited again this quarter. The shift
' u0 f. G2 v9 b# I; Bto balanced market conditions, which began in late 2005, has continued
/ \7 p1 ~8 V* M0 N: A7 [throughout most of the Central and Eastern regions of the country. In the core
- D6 k" w+ i, P1 i4 yenergy producing western provinces, the combination of very high in-migration,& ^5 c4 O2 C6 e- s& D& w# a! U
manageable affordability, and a shortage of inventory has driven record; @* {8 |/ C$ [8 K. c
breaking price appreciations.
0 l/ z q: U' v
" F, F7 _' Y# ^# M# { Echoing the second quarter and supported by Alberta's rapidly expanding
& c. N0 E, M2 I2 I7 ?economy, Calgary and Edmonton led the charge of Canadian cities with the1 z9 p9 S7 C% @5 C: [ [% H- [0 U
largest house price appreciation in all housing types surveyed.: _8 m7 D3 r: w7 z8 `- Q9 j
, O& v$ [3 U0 f In Ottawa and Toronto, growth remained steady, supported by solid
) s" @2 w" ?+ B2 C$ Ueconomic fundamentals, an increase in available inventory and strong consumer
i7 O( B& C. o1 h3 Y$ sconfidence. While the pace of price appreciation in Ontario leveled off1 d# R+ \0 ?/ B$ A; l
slightly, the province's real estate market remains poised for modest growth.7 l5 i! U* y4 b8 o
In Atlantic Canada, new housing and condominium construction offered buyers: x% T% {. o' ~5 Y1 U+ n
greater selection at more competitive prices, resulting in a slower rate of
1 |; e( m3 S! l r: [! Eprice appreciation when compared with 2005.4 G+ I/ Q4 X0 l P
# f, B" W, @: \. S& I
While the pace of growth in Canada has slowed, the domestic housing
( N* g( j+ s3 A6 X" o1 F) ~% b9 nmarket is expected to outperform the American market. The economic and
: Y' |% D1 y2 y5 }3 j2 ~$ cfinancial fundamentals driving the residential real estate sector in Canada2 Y$ [7 ]1 X4 E) k, j L4 H) m& N' J
are markedly different than those found in the United States.5 d! g) @3 y8 `' t5 e8 z
' ?1 c; p. Y6 Z$ X' W$ r Added Soper: "Canada's housing market is likely to outperform the
' d; R5 M5 d- u! ^# cAmerican market through 2007. A number of factors are working in Canada's5 x% O& t7 X: o' O
favour, including healthy personal and governmental debt levels, the
5 R- b7 A* B/ }3 Mrelatively modest rise in interest rates in our country, and general
2 l1 F# r: q) r, |2 k8 Aaffordability in our major cities. In addition, Americans are now seeing the* r2 v4 n7 R. `9 [4 d4 S y
downside of a tax system that encourages maximum homeowner leverage, and- U: R5 M0 J0 ^# v6 T
aggressive financial products such as zero- and negative-amortization8 B$ s3 |* ]' v" N1 _" @
mortgages that work only in a high price growth environment."; h% d3 c7 [6 x9 d
2 q6 i; b( V3 C3 `. P <<! G+ s. R9 u9 B
REGIONAL SUMMARIES
1 {4 A0 z& s/ Q >>
: }/ x5 S! `9 }/ B2 t! n$ B0 _$ H9 p7 O B# C7 T# Q3 f |- |
Balanced conditions continued to characterize the housing market in
8 K1 h1 `1 T) K0 oHalifax, as significantly higher inventory levels helped to moderate the rate
9 {1 c" c/ x. ^# b. Wof price appreciation. Buyers were increasingly choosy, taking more time9 B- G1 Y- b. T$ L
looking for newer, low-maintenance properties that were not in need of
2 g, [) G- l) Z, hrenovations.
5 I0 e6 S) S; S: |( p4 L2 T. E. ?% v) J8 p) A# n& p8 ?
The housing market in Moncton remained healthy and strong as a slight& `: i$ A$ w- x
increase in inventory helped to moderate the rate of price appreciation) H3 @& V0 }; g; v" Z
compared to the same period in 2005. Activity was brisk throughout August and
7 H# k ]# m$ d+ H) HSeptember and is expected to remain this way through the fourth quarter.
) A) A6 R) _ H. G' t
3 I& _8 M3 G0 ^2 c) y The housing market in Saint John underwent its traditional summer
1 I( P8 O ]# K8 n3 |slowdown in the third quarter, with activity picking up towards the end of the* ~/ }$ X y/ ~, {. ^# h
quarter. The local economy continued to thrive, as construction on a new& s& a9 ^6 h$ W# P6 n
600,000 square-foot shopping area has begun, bringing several new box stores
# D9 ~! B+ E$ D1 O/ D3 w1 kto the area. Buyers have begun seeking less expensive fixtures for their homes
9 ?3 k/ W5 `' [' mand are instead opting for more affordable housing options.
$ X1 D6 j1 y6 t& [9 }. S9 A0 H& {' W9 K( _+ h! Y
In Charlottetown, the housing market started to move towards balanced4 @7 S5 k+ v; N( j
conditions, as some sellers had to begin to lower the asking prices on their
8 c, I: ~0 P5 z: @' M# M' h4 phomes to make them more competitive. Activity from out-of-town and US buyers, F; T3 R" }4 ~
was down slightly compared to 2005, likely attributable to the strong Canadian2 b) c2 |. s* |5 _/ D; r" _
dollar. Inventory levels began to creep up in the third quarter, providing
2 Z" G5 |5 C, J7 N9 Pbuyers with more options when looking for a home.' E5 G9 w9 H, w: [3 R
$ F9 h, b$ }0 _( W9 A. l( z Activity in St. John's slowed slightly in the third quarter, particularly
. i& ^. T* U* t* @- U* \among higher-priced properties, where there was a slight over-supply of homes
8 ~& K7 d/ M8 U5 S! {/ @& d' }priced over $200,000. Listing periods have increased when compared with 2005,
/ c% Y; N# C. I0 E$ oas some of the pent-up demand that had characterized the market over the last( N! y1 s4 [9 f- b! X6 Q3 n
few years has been satisfied, resulting in more normal, balanced conditions.# G0 W+ b4 K {3 A9 P5 D
# _: y5 C- O, {1 D* W4 l
Montreal's housing market recorded modest increases in average house2 J- u$ P/ {" o/ Q/ S
prices, due to a slight seasonal slowdown in the third quarter as inventory
- m" {. @% d$ N# ~& Blevels rose. Part of this can be attributed to the fact that many renting2 @; m5 {% C* _
first-time buyers were motivated to close on the purchase of a home by July 1,
8 `5 ^5 ]$ G- n1 t+ N+ @7 Fwhen rental leases expire in Quebec. Once this date has passed some of the
) c/ E# c4 y: T/ Kpressure is taken off the market, allowing buyers to visit more homes before
) c% E! c: w" t1 t1 z* ~making a purchase.9 A. _5 h x e5 V
0 ^7 R- n% j0 Z" c) z& [ Ottawa held its position as one of the country's most stable housing3 D& ?# I. M) d2 M( [
markets in the third quarter, reinforced by a vibrant local economy and strong! O! _: {+ X8 ^# J" ^1 d0 K6 ]
confidence, resulting in modest increases in average house prices. The city1 `3 E. D5 T# ?
centre remained a bright spot in Ottawa, with homes in this area attracting
( Z7 c2 ?2 D: F' xattention due to their convenient location and proximity to downtown& F7 `; |! @6 x5 ]
amenities.# \( T1 B$ W9 q& `9 A: P) {/ M, H
& f- I# F: [8 [9 O, v, S) E The housing market in Toronto sustained healthy activity levels% O& y% _0 [) R6 k7 t
throughout the third quarter, as a strong economy helped to maintain demand
E. a$ N$ i3 f, Eacross the city, causing average house prices to rise moderately. Toronto has. x* d$ l. K0 [" u
continued to experience modest growth in average house prices, and has been
7 T9 x2 V1 @ O, X& Cdriven primarily by purchasers who are buying homes as their principle
3 L" k2 O- U, }residence, rather than for investment.
" W" |- ~( W" s2 D0 ^! e! H, h) P: |% u4 F0 h- w
The vibrant Winnipeg housing market continued to show its strength as
+ L& ^; D T7 Dhouse prices rose during the third quarter. The booming local economy resulted
0 P- a( H8 S/ ^, uin a historically low unemployment rate, helping to bolster consumer
/ }1 E F- l* N, N- c/ _+ h$ k7 _/ Hconfidence and Winnipeg's ranking as the city with the lowest capitalization: l4 I4 \ ^- c7 ~( x
rate among the country's larger cities - helped to encourage buyers to enter
_: f3 V7 R) V. A% Hthe market.
4 s. ]- X; D- _$ J# ~3 C/ X4 u8 c' x0 |# H* z- j, h# P
In Regina, the market experienced a slight seasonal slowdown through2 Z, F$ S3 w- n6 l
July, as there were fewer purchasers in the market due to summer vacations. In9 O W! G3 X* X( C i- t
August, activity resumed to the busy pace previously seen in the spring0 H" t1 k$ _ f p+ u4 b( M3 J/ m
months, as the influx of purchasers made it more difficult to find a home due1 @& F2 R9 I6 c1 p6 N- |1 B- \! _
to the shortage of available inventory.
) f! |0 d m5 K3 \" N7 o, X0 S1 |3 e$ X$ a6 ~6 Y2 O
Activity in Saskatoon remained brisk as the market maintained its4 _; q$ D1 [: l4 s8 w! h
momentum from the busy spring sales period. The economy in Saskatoon remains+ Q! p" a+ t2 N+ A; Y
vibrant, as employment opportunities are abundant with many businesses0 \% x+ ^: z0 S; U' ?; N
struggling to make hires and having to recruit outside the province.
5 `) |2 D1 D( \+ `; q; c F/ ?0 U, Y1 s+ x3 d2 Y
Calgary's housing market recorded blazing average house price increases9 Y# A( [; K) u; p$ R
in the third quarter, in all surveyed categories. The burgeoning economy, low
U9 x3 p' m3 [/ W/ I* eunemployment rates and low inventory levels remained the leading factors that% w1 a: l0 ]& E: Z/ P' O/ t
pressured Calgary's house prices upwards. However, regardless of the soaring
- O" P/ z3 l8 v/ n2 O: h7 Fprices that characterized the market - even during the typically slower summer
& |# a' _6 H0 ]/ S5 L6 b6 \season - it is expected that activity will become slightly more balanced, as/ D1 S7 o" v9 E1 I
buyers are becoming more reluctant to participate in the frenetic activity.- a. H, _1 W! w0 R2 g9 I
0 c; b( h8 R/ v! r, i Edmonton's booming local economy continued to thrive in the third quarter
' _3 B$ b; j# R s; mas activity in the oil sands north of the city continued to flourish. Edmonton
; Y+ q: R+ s- n& Yremained the hub of activity for those coming to work in the oil industry,
% |- K* Y: A& y7 H" Q( P+ J2 \maintaining tight inventory levels across the city, resulting in prices
( t) Y" |" e0 l2 _ U' U. F" _increasing at record levels. However, as inventory levels continued to improve
1 Y c! g5 A& |* K4 hin the third quarter the rate of price appreciation should moderate slightly
/ A& o8 v3 ?. X2 ?% b0 C o3 m; Mtowards the end of 2006.
4 W$ \4 {% d+ R+ M$ X( E& q
4 B, D1 H$ X$ xWhile Vancouver has seen a slight reprieve from the severe shortage of
9 ~. T$ ^+ i* cinventory that had previously characterized the market, supply is still unable$ I4 ^- @" l; [) l! G( P% ]) |" X
to meet demand, driving house prices upwards. Vancouver has a very diverse/ r' G+ f/ f; ] {
group of active buyers - from first-time home buyers to baby-boomers to
W* O2 {- {( h6 }6 jforeign investors - all of whom fuel the demand for houses, placing added
" S/ k) B; o9 ~! upressure on tight inventory levels.
+ U8 S, y" Y2 j( s/ F2 q% k
( G- R' {+ [, e7 e$ A Victoria's market is vibrant and supported by strong economic
1 P" F7 U/ i: h- Y1 x; S. O5 Kfundamentals, fuelled by a booming tech sector and a migration of young people7 l: g( Y4 p) ~) s( y [8 l
into the city that has continued to support the area's house price increases;1 ^& O$ z& D: @+ E/ z V
while increased inventory levels have afforded buyers more time when searching }+ d3 [8 a7 |! Q8 g( o, e
for a home, helping to normalize the market's pace.
9 R% @% g1 u6 X& M; M. B, S
1 r' Y4 g( k Z& n } <<
& a7 E' q" T1 F7 w) W, J+ ? Survey of Canadian Average House Prices in the Third Quarter 2006* B3 E8 o9 z8 _5 w3 M6 v
8 j. S2 B; ]; b/ Y3 J -------------------------------------------------------------------------
8 |8 l" H- `& l5 }9 e) w8 v Detached Bungalows Standard Two Storey& h8 Y4 ?) b3 a: \- T7 a
-------------------------------------------------------------------------, n- U4 ]7 R3 M- F
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
F- r6 Z4 }" M. G, S, v Market Average Average % Change Average Average) d; s8 r, s; f
-------------------------------------------------------------------------
! b6 O5 ^/ f& V6 r7 { Halifax 186,333 173,333 7.5% 198,667 199,000
% I+ k; s* \! C6 C, c% k. I -------------------------------------------------------------------------9 t ]- }+ a$ ?/ {$ m! e) u% U
Charlottetown 145,000 141,000 2.8% 175,000 170,000: g o& A6 Q& D9 l0 j9 ~% G
-------------------------------------------------------------------------
' c5 s& N1 \( K' n6 ]& u Moncton 135,000 127,000 6.3% 129,000 123,000. Y* b0 I+ ^0 F7 t
-------------------------------------------------------------------------# g1 S: I8 w( L& M
Saint John 141,200 142,900 -1.2% - -
8 p B; `( X6 s -------------------------------------------------------------------------
4 L7 |7 W1 z/ `$ o& y2 K0 u St. John's 143,667 142,667 0.7% 200,667 202,333
2 d: w8 P$ M2 j7 C. R6 \" b$ _ -------------------------------------------------------------------------
' x, n% I3 U" |$ a: f Atlantic 150,240 145,380 3.3% 175,833 173,583" W1 X' a. M' g% o$ J7 O
-------------------------------------------------------------------------
$ i+ P, Z" Y- e# ^" j) D" X Montreal 213,691 203,500 5.0% 321,141 316,185# g2 X k- {" t$ y" C
-------------------------------------------------------------------------6 O3 n: X! o5 H8 z1 o
Ottawa 290,083 278,417 4.2% 285,667 273,250
/ V8 I3 I8 M3 o- R -------------------------------------------------------------------------( z; X/ v9 L Y6 q" l
Toronto 373,368 355,882 4.9% 481,523 474,766+ @9 r: j9 O2 C* V( M5 ?! V
-------------------------------------------------------------------------/ w! R5 H" K# R: W _( @. H. t
Winnipeg 181,579 159,860 13.6% 202,337 180,7074 r, |9 l& H2 X' J( I @) |) Y
-------------------------------------------------------------------------$ W3 Q6 B4 [: P( l1 e$ |# g2 }
Saskatchewan 170,667 156,083 9.3% 182,600 166,500* W% c8 c$ B# n: `! C* O" @7 B( N
-------------------------------------------------------------------------8 }, l% V% c T6 i9 x4 z
Calgary 395,067 252,411 56.5% 405,778 264,389
) v; S+ Q5 e& F$ m$ {. I+ ? -------------------------------------------------------------------------" v3 p* d7 J7 }+ X+ Z, G
Edmonton 286,857 194,857 47.2% 316,429 206,714; a& e0 W2 K( ^8 E4 n9 d
-------------------------------------------------------------------------( q+ r# m: G0 i3 B, m1 |* K _
Vancouver 704,250 601,000 17.2% 794,000 697,500
. o/ B7 u! {, s# g0 V' K -------------------------------------------------------------------------& j8 s, \9 a Z
Victoria 375,000 348,000 7.8% 403,000 391,000; d& a2 j z9 l6 z6 }+ F
-------------------------------------------------------------------------
( @% Y' }6 i A6 U, [2 ? National 300,365 258,202 16.3% 365,380 322,860- Q/ O( Z* U( x9 l0 G) Y
-------------------------------------------------------------------------3 B/ z2 r: ]- F* ~# j5 A
# p8 V1 b8 j: ^9 b: W. \
-------------------------------------------------------------
! `, D$ m; p! a Standard Condominium8 @# n, i9 D* X/ {
-------------------------------------------------------------3 ^5 z7 X8 w4 r; S6 S
2-Storey 2006 Q3 2005 Q3 Condo
" Q5 a' `0 w: n1 @% d Market % Change Average Average % Change, K+ Z2 m# z) ~: r8 u4 ^
-------------------------------------------------------------# T7 N# ^8 E/ R5 O" {- S
Halifax -0.2% 142,000 103,000 37.9%$ g5 X5 f4 R, M7 q& a, G( V
-------------------------------------------------------------
4 D8 m$ f2 c4 P Charlottetown 2.9% 98,000 98,000 0.0%
& h" y7 J/ J2 B) _& r% n -------------------------------------------------------------
0 ^$ U2 N% E- G* { Moncton 4.9% - - N/A. z/ D: Q. y: z9 E+ j
-------------------------------------------------------------4 t' y( l- h$ K% {6 A
Saint John N/A - - N/A( S( n0 ], x3 R- g' S
-------------------------------------------------------------
[+ J/ ~% ~, X, R' y8 w1 C St. John's -0.8% 146,333 145,667 0.5%
: w- l* h% u c) x! m1 ] -------------------------------------------------------------, g( ]* ]. {- d" r- i
Atlantic 1.3% 128,778 115,556 11.4%: L- D1 z- A0 N, d, c
-------------------------------------------------------------3 f2 x, s7 l( v* G
Montreal 1.6% 193,190 188,016 2.8%/ E; d! I. D J& O- ^- p+ I1 s
-------------------------------------------------------------
# U8 [8 f" i% ]3 l' `8 U8 a Ottawa 4.5% 181,083 172,250 5.1%- H2 j) W/ {& I2 W& C+ `( Y
-------------------------------------------------------------
0 d+ a# x$ g) u$ ` Toronto 1.4% 252,088 242,918 3.8%
5 c& S; C& r, I- _9 J% w7 f1 {" s( k -------------------------------------------------------------
1 t# @# a7 T+ M' f Winnipeg 12.0% 105,648 96,008 10.0%
- k2 R9 }: z- |( [+ O" u2 N -------------------------------------------------------------% F; F1 ~ k, m" ^9 P: _
Saskatchewan 9.7% 106,250 101,000 5.2%
( L: W: q5 E# i. B -------------------------------------------------------------
, e7 X* v/ S. Y/ N& j8 a Calgary 53.5% 245,844 153,867 59.8%
0 T6 o9 P0 ^3 U4 H" k7 G3 Y -------------------------------------------------------------) j. @* w( a. [% v1 t
Edmonton 53.1% 200,433 131,500 52.4%
& c! x* d) F' [. ]1 ~; \ -------------------------------------------------------------
3 a8 O r6 Y# z- K i Vancouver 13.8% 366,250 323,250 13.3%2 @1 r' \. E- ~2 }
-------------------------------------------------------------
' x0 W' a2 k7 W Victoria 3.1% 229,000 220,000 4.1%) h3 f" T$ Z% x8 F
-------------------------------------------------------------, ?3 y. @( z* ~5 A/ e% Z% g3 P( a% X
National 13.2% 211,562 185,296 14.2%
1 A+ a/ K+ h% P2 H8 J$ E, u -------------------------------------------------------------$ o! q, I9 }6 h% w3 Y4 \% j; M$ S
>>2 s; o& u Q G: G
7 o# s( h, ?* W$ p3 @
Average house prices are based on an average of all sub-markets examined
( T' l1 z* _1 @& v B5 A9 }in the area, except for the smaller markets of Charlottetown, Moncton, Saint5 ^8 e/ S% b, V' H( y
John and Victoria.
9 w4 N5 P) v* f- p6 t4 o) X: a9 Q9 F" q
The Royal LePage Survey of Canadian House Prices is the largest, most
, r5 K$ I, j `# F: {# W" }comprehensive study of its kind in Canada, with information on seven types of5 S8 L- Z' i) V2 G5 C: B! j
housing in over 250 neighbourhoods from coast to coast. This release ^8 v3 X+ U8 N) |/ z5 T' s$ F
references an abbreviated version of the survey, which highlights house price
* X* Z9 [' G. H b7 t4 \trends for the three most common types of housing in Canada in 80 communities7 u+ c) `7 h3 I. E% T
across the country. A complete database of past and present surveys is$ B# k! j% h& b9 Z4 d! c# d
available on the Royal LePage Web site at www.royallepage.ca, and current
; j; T: D( E$ Q- efigures will be updated following the end of the third quarter. A printable
5 z& x! K! }, k X8 Iversion of the third quarter 2006 survey will be available online on
7 D: j- k. S8 bNovember 15, 2006.
% q+ d4 o' d! T( t( ? Housing values in the Royal LePage Survey are Royal LePage opinions of
& ^+ f3 u/ u2 W" Dfair market value in each location, based on local data and market knowledge
g! m; o$ J8 R& \# B _provided by Royal LePage residential real estate experts. Historical data is- ~( t1 V: @9 Q1 w. y: M# e2 B# I
available for some areas back to the early 1970s. |
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