After six strong months, 'a slower second half of the year is expected,' a market update says. House prices have likely peaked after a strong six months, Royal LePage Real Estate Services said Thursday in a market update.
While prices saw big year-over-year price increases in the second quarter, "high house prices are concealing early signs of a moderating market."
"The market has seen its near-term peak in house price appreciation, and a slower second half of the year is expected," the real estate brokerage said in a statement.
Still, the national average price is expected to end the year 7.7 per cent higher than they started. At the end of the second quarter the average price for a standard two-storey home rose 6.1 per cent to $390,163, a bungalow rose 7.5 per cent to $356,625 and a condo rose 3.5 per cent to $238,064.
"In many of Canada's regional markets, we saw house prices appreciate at a significantly faster rate than wages and salaries, and this trend cannot continue indefinitely," said Phil Soper, chief executive officer.
Regional Market Summaries
Halifax: "Healthy year-over-year price gains across all three housing types surveyed. Strong local economy coupled
with low interest rates has driven demand in the region. At the end of 2011, average house prices in Halifax are
forecast to be 3.3 per cent higher than 2010."
Montreal: Detached bungalows and two-storey houses posted strong year-over-year gains - higher than 7 per cent in
the second quarter, while standard condominiums rose modestly by 1.9 per cent. At the end of 2011, average house
prices in Montreal are forecast to be 7.0 per cent higher than 2010. "
Ottawa: "Year-over-year price appreciation across all housing types surveyed. An average standard two-storey home
rose 5.2 per cent year-over-year to $371,500. Despite modestly rising inventory, at the end of 2011, average house
prices in Ottawa are forecast to be 5.0 per cent higher than 2010."
Toronto: "Seller's market witnessed strong year-over-year price appreciation. Price gains ranged from 4.7 per cent to
6.1 for the housing types surveyed. Low inventory coupled with low interest rates continue to drive real estate prices.
Lack of inventory was cited as the main reason for reduced market activity."
Winnipeg: "Confidence in the local economy has brought optimism to the market and is reflected in the real estate
market's performance. Detached bungalows rose 7.5 per cent to $281,125, while condominiums rose 6.6 per cent. At
the end of 2011, average house prices in Winnipeg are forecast to be 6.0 per cent higher than 2010."
Regina: "The largest year-over-year gain was seen in Regina, where standard two-storey homes jumped 15.6 per
cent. Detached bungalows also posted a strong 11 per cent gain. Regina's limited inventory has not been able to keep
up with the demand created by the booming local job market. At the end of 2011, average house prices in Regina are
forecast to be 12.4 per cent higher than 2010."
Calgary: "Witnessed moderate year-over-year price declines as it continues to adjust from the boom experienced in
the middle of the previous decade."
Edmonton: "Modest gains for standard two-storey homes and standard condominiums, while detached bungalows
posted a moderate year-over-year decrease. At the end of 2011, average house prices in Calgary are forecast to
increase 3.8 per cent while Edmonton house prices are expected to decrease moderately by 1.2 per cent compared to
Vancouver: "Experienced some of Canada's largest year-over-year price increases with detached bungalows rising
14.1 per cent and standard two-storey homes rising 12.0 per cent. Average prices for standard condominiums
stabilized rising 2.5 per cent. At the end of 2011, average house prices in Vancouver are forecast to be 15.4 per cent
higher than 2010. Unit sales in Vancouver, during 2011, are expected to be 6.0 per cent higher than 2010 indicating
strong market activity."
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July 7, 2011
House prices may have hit the top
By STEVE LADURANTAYE
Globe and Mail Update
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