Supported by booming energy sectors, Saskatchewan, Manitoba and
New Brunswick experience highest house price gains in Q4 2007 -
TORONTO : – Canada’s real estate market posted significant
gains in the fourth quarter of 2007 and showed little sign of the traditional
seasonal slowdown. Average house prices continued to increase in the fourth
quarter with many markets experiencing double-digit gains, according to a
House Price Survey report released today by Royal LePage Real Estate Services.
Of the housing types surveyed, detached bungalows increased to $337,555
(+11.6%), followed by standard two-storey properties, which rose to $399,738
(+11.3%), and standard condominiums, which increased in price to $240,395
(+11.7%), year-over-year.
“The fourth quarter 2007 was surprisingly strong, with unseasonably high
price increases and unwavering demand,” said Phil Soper, president and chief
executive, Royal LePage Real Estate Services. “The strength of the market was
apparent throughout the country, largely due to positive economic
fundamentals. The value and export-demand for our natural resources has
underpinned high employment rates, providing Canadians with confidence in the
future stability of their jobs and their local residential real estate
markets.”
Mirroring the pattern seen throughout most of 2007, it was the prairies
that continued to dominate in price appreciation, with markets such as Regina
and Saskatoon experiencing price increases as significant as 50 per cent.
While agriculture is still a significant contributor to the regional economy,
natural resources such as oil, gas, potash and uranium continued to drive
exceptional growth in the area.
Homeowners in Saskatchewan saw property prices appreciate at a much
higher rate than anywhere else in Canada, reflecting the relative
affordability of homes in the region, and a shortage in supply relative to the
booming demand for home ownership. The combination of a spike in the number of
available jobs, the reasonable cost of living, and the attractiveness of the
prairie lifestyle led to an unprecedented number of people searching for
homes.
In Winnipeg, demand outstripped supply, prompting significant price
increases. A sharp rise in new housing starts, high employment rates and
several capital investment projects all contributed to the province’s positive
economic outlook. The increase in jobs also elevated consumer confidence and
provided buyers with the ability to spend more on homes. Buyers entered the
market eager to purchase properties before anticipated price increases occur.
Throughout the fourth quarter, Vancouver’s population continued to surge,
as the city held great appeal for both investors and newcomers to Canada. The
availability of a variety of jobs associated with the 2010 Olympics helped
maintain the strength of Vancouver’s housing market, and continued to pressure
house prices upwards.
In Alberta, the year end saw strong demand for more reasonably priced
properties in resource rich Calgary and Edmonton; however, a surplus of
inventory tempered activity levels and provided buyers with a selection of
listings from which to choose. The rapid escalation of home prices in recent
years has moderated demand and supports the current trend towards balanced
conditions. This is in sharp contrast to the first quarter of 2007, when
average house price increases in excess of 50 per cent were the norm in
Edmonton.
The impact of the rise of Canada’s dollar to parity with the US dollar
was mitigated by the end of the fourth quarter, as the manufacturing sectors
in Ontario and Quebec continued to adjust to the dollar’s appreciation. Buyer
activity levels in Central Ontario and Quebec remained strong and steady
through the fourth quarter. In fact, Toronto displayed high levels of home
buying activity in the fourth quarter, despite the city’s rising house prices,
partly related to the introduction of a new land transfer tax that will be
implemented on January 1, 2008.
Within Atlantic Canada, Saint John reported the highest price gains in
the fourth quarter, and was among the country’s top five cities with the most
significant price appreciations. In Saint John, it was the energy sector -
which makes up more than half of the province’s total exports – that continued
to drive the city’s economic vitality, luring both Atlantic residents and
investors to the city’s real estate market. Despite a restructuring of the
Irving family’s business assets, discussions persist about the development of
a new $7 billion refinery in the Saint John area – a plan that would further
solidify the province’s reputation as the natural resource hub of eastern
Canada.
Added Soper: “As we move into the new year, activity levels are expected
to wane from the frantic pace that many regions of the country experienced in
2007; however, average prices are expected to continue to rise, albeit at a
much more moderate pace. Canadian buyers and sellers can expect healthy,
balanced conditions in 2008 – the best environment for a strong and
sustainable real estate market.”
<<
—————————————–
Detached Bungalows
————————————————————————-
Q4 2007 Q4 2006 Bungalow
Market Average Average % Change
————————————————————————-
Halifax $201,333 $188,667 6.7%
————————————————————————-
Charlottetown $152,000 $145,000 4.8%
————————————————————————-
Moncton $151,000 $147,100 2.7%
————————————————————————-
Fredericton $155,000 $153,000 1.3%
————————————————————————-
Saint John $196,500 $137,000 43.4%
————————————————————————-
St. John’s $157,667 $143,667 9.7%
————————————————————————-
Atlantic $168,917 $152,406 10.8%
————————————————————————-
Montreal $229,314 $217,500 5.4%
————————————————————————-
Ottawa $308,583 $292,250 5.6%
————————————————————————-
Toronto $413,375 $379,656 8.9%
————————————————————————-
Winnipeg $214,494 $177,616 20.8%
————————————————————————-
Regina $229,200 $150,375 52.4%
————————————————————————-
Saskatoon $292,500 $188,500 55.2%
————————————————————————-
Calgary $429,889 $408,833 5.2%
————————————————————————-
Edmonton $336,786 $298,571 12.8%
————————————————————————-
Vancouver $795,250 $707,500 12.4%
————————————————————————-
Victoria $425,000 $380,000 11.8%
————————————————————————-
National $337,555 $302,497 11.6%
————————————————————————-
—————————————–
Standard Two Storey
————————————————————————-
Q4 2007 Q4 2006 2 Storey
Market Average Average % Change
————————————————————————-
Halifax $231,667 $199,333 16.2%
————————————————————————-
Charlottetown $180,000 $175,000 2.9%
————————————————————————-
Moncton $135,000 $130,000 3.8%
————————————————————————-
Fredericton $197,000 $187,000 5.3%
————————————————————————-
Saint John $255,000 $203,300 25.4%
————————————————————————-
St. John’s $219,333 $196,667 11.5%
————————————————————————-
Atlantic $203,000 $181,883 11.6%
————————————————————————-
Montreal $342,491 $319,573 7.2%
————————————————————————-
Ottawa $306,500 $287,000 6.8%
————————————————————————-
Toronto $506,900 $469,545 8.0%
————————————————————————-
Winnipeg $237,571 $198,621 19.6%
————————————————————————-
Regina $199,000 $146,500 35.8%
————————————————————————-
Saskatoon $321,250 $205,000 56.7%
————————————————————————-
Calgary $461,811 $425,644 8.5%
————————————————————————-
Edmonton $370,000 $325,714 13.6%
————————————————————————-
Vancouver $895,000 $803,500 11.4%
————————————————————————-
Victoria $456,000 $417,000 9.4%
————————————————————————-
National $399,738 $359,213 11.3%
————————————————————————-
—————————————–
Standard Condominium
————————————————————————-
Q4 2007 Q4 2006 Condo
Market Average Average % Change
————————————————————————-
Halifax $148,500 $142,500 4.2%
————————————————————————-
Charlottetown $100,000 $ 98,000 2.0%
————————————————————————-
Moncton N/A N/A N/A
————————————————————————-
Fredericton $126,000 $126,500 -0.4%
————————————————————————-
Saint John N/A N/A N/A
————————————————————————-
St. John’s $165,000 $146,333 12.8%
————————————————————————-
Atlantic $134,875 $128,333 5.1%
————————————————————————-
Montreal $201,912 $191,179 5.6%
————————————————————————-
Ottawa $196,833 $182,750 7.7%
————————————————————————-
Toronto $280,505 $254,019 10.4%
————————————————————————-
Winnipeg $124,270 $103,460 20.1%
————————————————————————-
Regina $144,000 $ 96,500 49.2%
————————————————————————-
Saskatoon $205,000 $124,000 65.3%
————————————————————————-
Calgary $284,144 $259,400 9.5%
————————————————————————-
Edmonton $240,500 $212,500 13.2%
————————————————————————-
Vancouver $428,250 $386,000 10.9%
————————————————————————-
Victoria $292,000 $238,000 22.7%
————————————————————————-
National $240,395 $215,251 11.7%
————————————————————————-
>>
REGIONAL SUMMARIES
In the fourth quarter, Halifax experienced better than anticipated house
price appreciation, as sales figures and average house price increases
continued to paint a picture of a healthy and well balanced housing market.
Low levels of desirable properties in the popular Sackville, Dartmouth and
Bedford neighbourhoods left little room for price negotiation, as buyers who
attempted to go-in below asking were largely denied entry into the market.
Moncton’s economy continued to shine in the fourth quarter, leading to
average house price increases. High mineral tax revenues, a strong
service-oriented economy and the grand opening of Molson Canada’s new
$35-million brewing facility continue to attract more buyers to an already
tight housing market.
In Fredericton, the strong provincial economy, and economic impact of new
commercial construction and the opening of several big box retail outlets
drove consistent housing market activity in the fourth quarter.
Saint John is enjoying a streak of positive press, strong consumer
confidence and exceptional year-over-year house price growth – three factors
that have pressured house prices upwards across all housing types in the
fourth quarter. Supply in the area continues to meet demand; however, with the
increase in optimism related to growth in the Saint John area, this will only
last for a short while longer.
Charlottetown’s housing market saw moderate growth in the fourth quarter,
as demand for lower-maintenance properties led to modest year-over-year house
price increases. New office building developments being built in the city’s
core and a strong provincial economy have positively impacted the confidence
levels of many area residents.
In St. John’s, speculation over the bourgeoning natural resource economy
and a second drilling project outside the Hebron Ben Nevis continued to lure
buyers to the area. Several new businesses to the city, including two
Starbucks coffee houses and several big box retailers, suggest the city is
poised for sustained growth.
Strong demand for houses in Ottawa continued to fuel price increases in
the fourth quarter. An anticipated shift in demographics to take place within
the workforce over the next few years has many newcomers flocking to the city.
Montreal’s real estate market continued to fire on all cylinders during
the fourth quarter. The combination of the city’s high level of consumer
confidence, a resilient economy that is adjusting to the strength of the
Canadian dollar, and affordable interest rates have all led to strong buyer
demand, pressuring average house prices upwards.
Toronto’s real estate market shattered all previously held records for
unit sales in 2007. The momentum from the year’s first three quarters carried
over to the end of the year, as robust buyer activity pressured average house
prices upwards.
As the year came to an end, Winnipeg’s housing market continued to be
characterized by rising average house prices, as inventory levels were not
able to satisfy buyer demand. A sharp rise in new housing starts, high
employment rates and several capital investment projects all contributed to
the province’s positive economic outlook.
In Saskatoon, the combination of continued in-migration, tight inventory
and increased property demand led to significant house price increases – of at
least 50 per cent, year-over-year. Market activity in Regina echoed that of
Saskatoon, as all housing types surveyed experienced significant
year-over-year double-digit increases.
In Calgary, an increase in inventory during the beginning of the fourth
quarter led to more balanced market conditions, and prompted single-digit
average house price appreciation. The city has experienced a surge in buyers
moving to condominiums in the downtown core simply due to their proximity to
amenities and affordable prices.
Despite the dramatic increase in available inventory seen in the last
three months of 2007, double-digit price increases were noted in Edmonton
across all housing types surveyed. While demand is strong, the increased
supply has impacted the resale market and homes that are not priced
appropriately will take longer to sell.
A strong economy and a job market brimming with opportunity attracted an
influx of buyers to Vancouver in the fourth quarter. In 2007, Vancouver’s
population grew considerably and census reports maintain that large urban
centres, including Vancouver, continue to attract people. During the fourth
quarter of 2007, Victoria’s real estate market experienced strong and steady
activity, and recorded a rise in average house prices. The fourth quarter also
saw slightly lower inventory levels, and well-priced product in most
categories continued to be at a premium.
The Royal LePage Survey of Canadian House Prices is the largest, most
comprehensive study of its kind in Canada, with information on seven types of
housing in over 250 neighbourhoods from coast to coast. This release
references an abbreviated version of the survey, which highlights house price
trends for the three most common types of housing in Canada in 80 communities
across the country. A complete database of past and present surveys is
available on the Royal LePage Web site at www.royallepage.ca, and current
figures will be updated following the end of the fourth quarter. A printable
version of the fourth quarter 2007 survey will be available online on
February 15, 2008.
Housing values in the Royal LePage Survey are Royal LePage opinions of
fair market value in each location, based on local data and market knowledge
provided by Royal LePage residential real estate experts. Historical data is
available for some areas back to the early 1970s.
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