Low interest rates and strong local economy offset by healthy supply of new homes
FORT MCMURRAY, AB, Jan. 12, 2012 /CNW/ - The Royal LePage House Price Survey and Market Survey Forecast released today showed that Fort McMurray is in a balanced market.
In the fourth quarter of 2011, standard two-storey homes sold on average for $710,000, while detached bungalows sold on average for $620,000. Standard condominiums, traditionally the most accessible price point, sold for an average price of $380,000.
"We experienced the typical slow down in the fourth quarter. However, sales increased approximately 10 per cent from this time last year," said Marian Barry, broker and owner of Royal LePage True North Realty. "Job creation in the oil and resource sectors and growing migration levels have helped contribute to strong market demand in Fort McMurray - a trend we see continuing throughout 2012."
Barry explains that inventory levels across most housing types are up slightly from last quarter.
"Inventory levels for standard two-storey homes and standard condominiums are plentiful due to the number of new construction projects that are happening throughout the region. However, the number of detached bungalows on the market is more limited, which may drive up demand for these property types."
Nationally, despite calls in some quarters for Canadian house prices to soften in 2011, the market proved resilient as demand created by low interest rates and a relatively stable national economy created upward pricing pressure for all housing types surveyed. Further, recent high profile reports forecasting significant house price declines in 2012 are not supportable. In the fourth quarter, standard two-storey homes rose 4.2 per cent year-over-year to $375,427, while detached bungalows increased 6.1 per cent to $344,392. Average prices for standard condominiums increased 3.6 per cent to $234,680.
"In the recovery period following the 2008-2009 recession, I found myself repeatedly speaking of 'irrational exuberance' in the Canadian housing market," said Phil Soper, president and chief executive of Royal LePage Real Estate Services. "Expectations were too high and the pace of expansion unsupportable. With this report, I find myself in exactly the opposite position. Widespread calls for a major real estate correction in 2012 simply can't be justified. The industry has significant momentum entering the year, and buoyed by the stimulative effect of very low interest rates; we expect the market to continue to expand - albeit at a slower pace."
Royal LePage expects average price growth to continue through 2012 and predicts national average prices to increase by 2.8 per cent by the end of the year.
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 www.royallepage.ca. Current figures will be updated following the complete tabulation of the data for the fourth quarter 2011. A printable version of the fourth quarter 2011 survey will be available online on February 10th, 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 symbolTSX:BRE.
For more information, visit www.royallepage.ca.
For further information:
Sarah Louise Gardiner
Director, Global Communications & Public Relations
Royal LePage Real Estate Services