Low interest rates and demand from overseas buyers continue to put pressure on limited housing supply

VANCOUVER, April 12 /CNW/ - According to the Royal LePage House Price Survey released today, standard two-storey homes and detached bungalows in Vancouver sold for nearly three times the average national price in the first quarter of 2011. A limited supply of homes for sale, low interest rates and ongoing demand from overseas buyers continued to drive up prices.

Standard two-storey houses posted the largest increases rising 9.7 per cent year-over-year to $1,083,750 in the first quarter. Detached bungalows followed with an 8.2 per cent increase, selling for an average of $980,000. Even standard condominiums, which are in better supply, increased 7.8 per cent - selling for an average price of $507,250. For the purpose of calculating city-wide Vancouver averages, the Royal LePage House Price Survey incorporates Vancouver West Side, Vancouver East Side, North Vancouver and West Vancouver.

"Continued low interest rates remain the most influential factor," said Bill Binnie, broker and owner of Royal LePage North Shore. "However, demand from mainland Chinese buyers continues to be strong and impact the market."

Although new listings are down slightly compared to last year, inventory is keeping up with the pace of spring sales. Well-priced homes are attracting multiple offers.

On Vancouver's West Side and East Side, where rezoning for higher density is further eroding single family home listings - a standard two-storey home sold for an average price of $1.5 million and $765,000 respectively.

"Vancouver West Side price increases have been the most significant," said Chris Simmons, broker and owner of Royal LePage Westside & City Centre. "Again, the reason is mainland Chinese buyers looking for detached, single-family homes."

Simmons also points out that, if Vancouver West Side and West Vancouver sales prices were omitted from the overall calculation, the average house price in Greater Vancouver would be significantly lower.

Nationally, low interest rates and a recovering economy continued to fuel activity in Canada's housing markets over the past year, which has led to country-wide increases in average home prices. In the first quarter of 2011, the national average price of a detached bungalow rose 4.3 per cent year-over-year to $341,355, while standard two-storey homes rose 3.5 per cent to $379,388 and standard condominiums rose 4 per cent to $237,919.

"The rate at which Canadian homes are appreciating may well have peaked for the next year or so," said Phil Soper, president and chief executive of Royal LePage Real Estate Services. "We expect house prices will continue to creep up, but most of the excess demand created by the initial drop in interest rates has been satisfied, and affordability continues to erode slowly, allowing the listings supply to catch up.  In most markets, lower single digit percentage increases are more likely for the balance of the year."

"Canada's real estate market has maintained momentum coming out of 2010, indicating that the post-recession recovery is continuing," Soper added. "While low interest rates continue to drive demand, the tepid pace at which employment levels are improving is tempering the rate of home price appreciation in many Canadian cities."

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 90 communities across the country.  A complete database of past and present surveys is available on the Royal LePage Web site at  Current figures will be updated following the complete tabulation of the data for the first quarter 2011. A printable version of the first quarter 2011 survey will be available online on May 6th, 2011.

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.

About Royal LePage

Serving Canadians since 1913, Royal LePage is the country's leading provider of services to real estate brokerages, with a network of 14,000 real estate professionals in over 600 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage Shelter Foundation, dedicated to supporting women's & children's shelters and educational programs aimed at ending domestic violence. Royal LePage is a Brookfield Real Estate Services Inc. company, a TSX-listed corporation trading under the symbol TSX:BRE.

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SOURCE Royal LePage Real Estate Services

For further information:

Jeremy Twigg
Fleishman-Hillard Canada
(604) 688-2505

Tammy Gilmer
Director, Global Communications & Public Relations
Royal LePage Real Estate Services
(416) 510-5783


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