-Despite a modest decline in sales forecast for the second half of 2010, Toronto's house prices are expected to remain steady-
TORONTO, July 7 /CNW/ - Toronto's real estate market has seen steady price increases during the second quarter of 2010, according to the Royal LePage House Price Survey and Market Survey Forecast released today. Standard two-storey homes and detached bungalows saw increases from both the previous quarter as well as year-over-year comparisons to 2009. The average price of a standard condominium saw a modest decline from the previous quarter but had increased 7.7 per cent over the second quarter of 2009.
"It's important to understand the real estate trend over the past year to keep these increases in context," said Gino Romanese, senior vice president, Royal LePage Real Estate Services Ltd. "In 2009, typical seasonal growth in the second quarter was delayed until the third quarter. Fueled by the threat of rising interest rates and to a lesser extent some pressure to buy prior to the introduction of HST, growth continued right through the second half of 2009 into the first half of 2010."
In the second quarter of 2010, standard two-storey homes increased 10.5 per cent year-over-year to $589,857 from $533,748 in 2009. Detached bungalows increased 11.4 per cent to $481,933 compared to $432,433 during the same period last year. Standard condominiums were up 7.7 per cent, with the average price in the second quarter rising to $326,913 from $303,650 in 2009.
"By the end of 2010, we expect to see about 7 per cent growth in average house prices in comparison to 2009. However, this growth has already been accounted for in the first half of 2010. Average prices are expected to decline moderately for the remainder of the year," added Romanese.
Some moderation of activity in the second half will be welcomed news to Toronto's potential buyers who have been frustrated by the frenetic market, and the shortage of homes available for sale. Romanese also noted that listing inventory in the GTA as of June 30th has increased from last year's record low of 18,700 to 23,900, giving potential buyers more choice.
This mirrors Royal LePage's national forecast, which predicts Canada's residential real estate market will start to slow in the second half of 2010 after two quarters of strong price appreciation and sales activity. While market fundamentals remain strong across most major centres in Canada, sales activity was overly 'front-loaded' in the first half of the year and is expected to cool off for the third and fourth quarters. Prices are also expected to steady in the second half of the year.
"We have seen an unusual pattern of activity in the housing market over the past 12 months, with the market experiencing a surge of activity and price increases that peaked in the fall of 2009 rather than spring. Early 2010 has followed a more typical seasonal pattern with prices and activity peaking in the second quarter," said Phil Soper, president and chief executive, Royal LePage Real Estate Services. "An expected increase in the supply of homes on the market will now bring stabilization in prices and in some cities we will see both prices and unit sales decline towards the end of the year. This should not be interpreted as a severe correction but rather a natural reaction to the market having peaked quite early this year."
The surge of activity in the first and second quarters of 2010 corresponds to a number of significant regulatory and financial industry changes that affected homebuyers over the same period, including an increase in interest rates in the spring, tightening of mortgage lending rules for first-time homebuyers and investors, and the lead up to the introduction of the HST in British Columbia and Ontario.
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 second quarter. A printable version of the second quarter 2010 survey will be available online on August 6th, 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: Sarah Louise Gardiner, Consultant, Fleishman-Hillard Canada, 647-339-6445; Tammy Gilmer, Director, Public Relations and National Communications, Royal LePage Real Estate Services, 416-510-5783