July 20, 2010
Real Estate Market Expected to Cool Slightly
Did you know that the latest Royal LePage House Price Survey, released on July 7, predicts Canada’s residential real estate market will slow slightly in the second half of 2010? While market fundamentals remain strong across most of Canada, sales activity was ‘front-loaded’ in the first half of the year and is expected to cool off. Prices are also expected to steady in the second half of the year.
Phil Soper, CEO of Royal LePage Real Estate Services says, “An expected increase in the supply of homes on the market will bring stabilization in prices… This should not be interpreted as a severe correction but rather a natural reaction to the market having peaked quite early this year.”
June 10, 2010
2010 Housing Market Forecast
Did you know that the Canadian Real Estate Association recently moderated their housing market forecasts for 2010? The national average home price is forecast to climb by 1.6% in 2010, reaching $325,400 according to the report released June 2. Sales activity is expected to hit 490,600 units, up 5.5% from the year before and a record number. Slowing sales in the Western provinces were largely to account for the moderation in forecast performance, according to CREA.
May 25, 2010
Canada Mortgage and Housing Corp Outlook
House prices will increase this year and next, Canada Mortgage and Housing Corp said on May 19. An “improved balance between demand and supply” will stabilize prices through the rest of this year,” CMHC said in its Q2 Housing Market Outlook. Prices will “rise modestly” in 2011, it said. CMHC said the average cost of a home by the end of 2011 should be $350,000, a gain of 1.4% over April’s record high of $344,968. CMHC senior economist Bill Clark said, “There was a big April gain in employment, and as the economy gets moving again people become more interested in housing.” CMHC attributed much of the recent sales activity to pent-up demand, as buyers returned to the market after sitting out during the recession. “Once this demand is exhausted, and as mortgage rates gradually rise, the pace of activity in the resale market will ease,” CMHC economist Bob Dugan said.
May 18, 2010
Royal LePage Survey of Realtors
Did you know a recent Royal LePage survey of 1,726 realtors found that 76% agree that the country’s real estate market is highly competitive? Phil Soper, CEO of Royal LePage says, “To state that there is a lack of competition in the Canadian real estate industry is simply incorrect. Every day, 100,000 men and women in the profession compete vigorously with each other and with unlicensed, unregulated alternatives.” In the survey, 86% of realtors are concerned that severe deregulation might erode standards of customer service and protection. More than 88% of respondents say they help clients avoid financial or transactional mistakes “very often” or “often.” For more information, go to http://www.royallepage.ca
April 26, 2010
Canada’s Real Estate Market Grew by 5.2% in 2009
Did you know Canada was in 12th place internationally in terms of real estate market growth? Canada posted a 5.2% year over year gain in 2009. Those are respectable numbers, especially during an economic downturn, but they pale in comparison to the top markets. Hong Kong was in first place with a 27.6% gain in prices during 2009, followed by China at 25.%, Israel at 21.3%, and Australia at close to 13.6%, according to a Frank Knight Frank LLP survey of global housing markets. Prices in Hong Kong and Asia have been driven upward by a “massive injection of liquidity into the economy by the Chinese government’s fiscal stimulus package,” said Knight Frank economist Liam Bailey. A Mainland Chinese buyer set a world record price for a condominium in Hong Kong last October, paying $57 million (U.S.) for a 6,000 square foot property, or more than $9,000 per square foot. In Toronto, an average new condominium sold for about $475 per square foot last year. Toronto’s market is much more sedate in comparison, but tell that to frustrated buyers caught in the middle of bidding wars. Canada’s performance has actually been more Steady Eddy than bullet train. Analysts say this has been positive for the economy as it avoids wild swings. In the United States, the market continues to flounder, with prices falling by 3.1% last year as a bottom has yet to be reached. However, U.S. existing home sales jumped by 6.8% in March according to reports released Thursday, beating expectations of a 5% gain.
April 11, 2010
Royal LePage House Price Survey Q1 2010
Did you know the Q1 Royal LePage House Price Survey shows that the real estate recovery, which began in the Q3 2009, continued unabated in Q1 2010?
“The first quarter of 2010 continued where 2009 left off, with more Canadians enthusiastically participating in a rejuvenated residential real estate market,” said Phil Soper, CEO of Royal LePage Real Estate Services. “One of the earliest sectors of the economy to return to growth after the difficult recessionary period, the housing sector has been a prime beneficiary of low borrowing costs and improving consumer confidence.”
House prices were up across all key housing types surveyed, with the average prices rising 10-11% in the first quarter year-over-year.
An analysis of Royal LePage data from Q1 2008 through Q1 2010 shows three different patterns of house price trends in Canada’s major cities: (1) Cities like Toronto and Vancouver show a rollercoaster effect in which prices dropped sharply then rose dramatically to levels that exceed pre-recessionary prices. (2) The non-stop growth markets were generally resilient through the downturn with incremental price appreciation over a two-year period (including Halifax, Ottawa, Regina, Saint John, St.John’s and Winnipeg). (3) In the level markets house prices have remained relatively unchanged (Calgary, Edmonton, Moncton and Montreal).
“Expect house prices to continue to rise, but the rate of appreciation should ebb steadily, month by month, throughout the remainder of the year, as balance returns to the industry,” concluded Soper.
April 5, 2010
Cottage Sales Show Signs of Recovery
Did you know that cottage sales are showing signs of rebounding as the economy heats up? The recent good weather and improving consumer confidence have many Ontario realtors reporting a much stronger start to the spring vacation property market this year. “Things are looking a lot better this year than last, and it seems to be across the board with all kinds of properties,” said Wendy Webb, president of the Muskoka and Haliburton Association of Realtors. In the first quarter of this year there were 324 sales, up 40 per cent from last year, according to the association. Dollar volume was also up by 46 per cent, representing more than $78 million worth of transactions. But last year also represented the depths of the market, when buyers sealed their wallets. The typical cottage market starts in April, but some agents started receiving calls in February for viewings. Cottages are the ultimate splurge, a part of discretionary income that is the first to go during a downturn. But they are also a bellwether indicator of the economy, with sales the first to rebound when consumer confidence returns.
March 22, 2010
February Sales Hit New Highs
Did you know sales of new houses and condominiums in the Greater Toronto Area were up by more than 237% in February compared with last year?
“The new home market continues to benefit from the tight conditions in the resale market, 50-year low interest rates and healthy levels of consumer confidence in real estate,” said the Toronto-based Building, Industry, & Land Development Association.
Compared with 2008, February sales were up 24%, and up 19% compared with 2007. February sales were virtually split between detached or town homes (51%) and condominiums (49%).
Statistics from RealNet Canada and The Toronto Star
March 11, 2010
Canadian Economic Growth Exceeds Estimates
Did you know the Bank of Canada recently reported that economic growth has picked up by more than previously expected? In the 4th quarter of 2009, the Canadian economy expanded by 5% on an annualized basis, and the core rate of inflation hit 2% year-over-year in December 2009. On March 2nd, the Bank said that, “The main macroeconomic risks to the inflation projection are roughly balanced.” The Bank also restated its commitment to keep its lending rate on hold until the second half of 2010, conditional on the outlook for inflation. At that time, it is generally expected that interest rates will rise, but increases will be small and spread out over time.
February 17, 2010
Canadian Real Estate Association Revises 2010 Forecast Upwards
Did you know that the Canadian Real Estate Association has revised its forecast for home sales upward this year, citing better economic conditions?
CREA forecasts 527,300 sales this year, up 13.3 per cent from 2009 levels. The previous forecast called for a 7 per cent increase.
The national average home price is forecast to rise 5.4 per cent in 2010 to a record $337,500.
But next year will start to see the impact of higher interest rates, with sales forecast to decline 7.1 per cent in 2011. That would put next year on par with levels reported in 2005 and 2006, according to the realtors’ association.
Year 2011 is when Canada’s realtors are expecting prices to slip 1.5 per cent.
“A downward trend in national sales activity combined with an increase in listings will result in a more balanced market,” said CREA chief economist Gregory Klump.
February 16, 2010
GTA Real Estate Market Shows Huge Increases
Did you know the January GTA real estate market started 2010 at full gallop, with sales up 87% from the year before, according to figures released February 3 by the Toronto Real Estate Board?
“The Greater Toronto Area home market has rebounded well from the lows experienced at the beginning of 2009,” said Tom Lebour, TREB president.
Placed in perspective, this January’s sales were slightly higher than the January average in the years preceding 2009 when the economy faced recession.
The average price of a GTA home this January hit $409,058, up 19 per cent compared with $343,632 in the same month last year.
TREB warned comparisons to last year will continue to be extreme in the first quarter of this year as “we continue to make comparisons to weak market conditions at the beginning of 2009.”
February 15, 2010
Royal LePage Market Forecast for 2010
Canada’s residential real estate market is forecast to remain strong through the first half of 2010 as economic conditions improve and the impact of low interest rates stokes demand, according to Royal LePage’s Market Survey Forecast. As confidence builds in early 2010, increases in average house price levels and overall market activity are expected to continue.
“The Canadian real estate market enters 2010 with considerable momentum from a strong finish to the previous year,” says Phil Soper, Royal LePage CEO. Strong demand, coupled with seasonal undersupply of homes for sale, should cause home prices to appreciate during the early months of the year. Improving supply as the year unfolds should moderate home price increases in the second half of 2010.
