- Higher volume of listings and low interest rates attracting buyers to market -
TORONTO, April 8 /CNW/ - The Royal LePage House Price Survey released today showed strong year-over-year price appreciation across all three housing types surveyed in Toronto.
On average, detached bungalows witnessed the largest year-over-year price increase climbing 13.3 per cent to $459,107. This is in contrast to the first quarter of 2009, when the same property type saw a decrease of 6 per cent in value from its previous year. Prices for standard two-storey homes were up 13.2 per cent to $562,150 after a decrease of more than 5 per cent from first quarter 2008 to first quarter 2009. Standard condominiums rose 10 per cent to $317,579 after decreasing 3 per cent from first quarter 2008 to first quarter 2009.
"We are seeing a lot of resale activity that is being driven by both first-time buyers and move-up buyers compared to the first quarter in 2009. First-time buyers entered the market earlier this year given the belief that interest rates will be rising, and that the HST will be implemented in July," said Gino Romanese, senior vice president, Royal LePage Real Estate Services Ltd. "The increase in first-time buyers also means that current homeowners who are looking at moving up the property ladder can be confident that there are buyers for their homes."
According to Romanese, properties that are appropriately priced are receiving, on average, their asking price. However, freehold properties in established central Toronto neighbourhoods such as Rosedale, Forest Hill and Leaside are often selling for above the asking price.
"There are many factors driving the volume of sales in central Toronto. Outside of low interest rates and the implication of HST, we are seeing some baby boomers downsize from their larger suburban homes and migrating to the city centre. Some buyers, are trading in square footage, for a shorter commute to work," added Romanese.
Higher activity usually results in lower inventory, but according to Romanese this has not meant a lack of choice for potential buyers.
"On average our current inventory is 21 per cent lower than last year but the number of homes being listed has risen 23 per cent. This increase in the number of homes coming onto the market has helped satisfy the increase in demand, and is expected to help moderate price increases throughout the Spring and summer market," concluded Romanese.
In comparison, the national average price of a detached bungalow in Canada rose 11 per cent to $329,209 in the first quarter year-over-year, while standard two-storey homes rose 10.3 per cent to $365,141 and standard condominiums increased 10.9 per cent to $228,963.
"National averages from our first quarter report are not particularly useful in painting a picture of the country's neighbourhood real estate stories. House sale data from the past two year period shows tremendous variances in terms of how different cities reacted to the recession," said Phil Soper, president and chief executive, Royal LePage Real Estate Services. "In Vancouver and Toronto, for instance, the dramatic unit sales fluctuations exhibit a significant degree of market irrationality: inordinately fearful when faced with poorer markets; and overly enthusiastic when the tables turned. Montreal is an example of a city where the market has been much more stable and homeowners there seem quite happy with the relatively slow pace of change."
In addition to strong price appreciation in the first quarter of 2010, the volume of sales in Canada also increased year-over-year as pent-up demand from constrained supply of homes for sale in 2009, coupled with unseasonably warm weather, prompted a spike in home sales in the country's largest housing markets from January through March.
About the Royal LePage House Price Survey
The Royal LePage House Price Survey 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. Current figures will be updated following the complete tabulation of the data for the first quarter. A printable version of the first quarter 2010 survey will be available online on May 7th, 2010.
Housing values in the Royal LePage House Price 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.
About Royal LePage
Royal LePage is Canada's leading provider of franchise services to residential real estate brokerages, with a network of nearly 14,000 real estate professionals in over 600 locations across Canada. Royal LePage is the only Canadian real estate company to have its own charitable foundation; the Shelter Foundation which is dedicated exclusively to funding women's shelters and violence prevention and education programs. Royal LePage is managed by Brookfield Real Estate Services, and is part of a brand family that includes Royal LePage, Real Living, Johnston and Daniel, and La Capitale Real Estate Network. An affiliated company, Brookfield Real Estate Services Fund, is a TSX listed income trust, trading under the symbol "BRE.UN."
For more information visit www.royallepage.ca.
SOURCE Royal LePage Real Estate Services
For further information: For further information: Michael Gotzamanis, Fleishman-Hillard Canada, (416) 598-5788; Tammy Gilmer, Director, Public Relations and National Communications, Royal LePage Real Estate Services, (416) 510-5783