House price increases forecast to continue through to year's end for most Canadian cities

    Despite easing rates of appreciation, average house prices set to rise by
    3.5 per cent nationally by year's end

    TORONTO, July 17 /CNW/ - Canada's real estate market is poised to
maintain the momentum gained from a solid second quarter through to the end of
2008, with Regina set to experience the greatest rise in house prices. While
home prices are expected to appreciate in all but two major markets during the
year, activity levels across the country are expected to decline from 2007's
record-setting pace, as pent-up demand is satisfied and some buyers retreat to
the sidelines in the face of increasing economic uncertainty, according to a
House Price Survey and Market Survey Forecast report released today by Royal
LePage Real Estate Services.
    During the second quarter, average house prices rose across most of the
country with rates of appreciation easing from the dramatic spikes that were
observed in 2006 and 2007. Continued robust demand led to strong double-digit
gains in Saskatchewan, Winnipeg and St. John's; while a surge in inventory
caused Alberta's white-hot market to record the country's only major-market
price decreases.
    "Canada's resale housing market proved resilient in the second quarter.
In fact, we have been pleasantly surprised that strong fundamentals, such as
enduringly positive employment numbers and reasonable mortgage rates, have
countered increasingly pessimistic consumer sentiment, based primarily on the
American housing recession," said Phil Soper, president and chief executive
officer, Royal LePage Real Estate Services.
    Added Soper: "After several years characterized by a persistent shortage
of listings, home buyers have felt the pressure of bidding wars and
take-it-or-leave-it counter offers ease during 2008; home sellers have had to
come to grips with the longer time it is taking to sell properties, but can
take comfort in a market that continues to support reasonable price increases.
Our research indicates that all markets will continue to perform well, albeit
at a tempered pace."
    The national average house price is forecast to rise by 3.5 per cent, to
$318,000 by the year's end. Home sale transactions are projected to decrease
by 11.5 per cent to 461,000 unit sales by the end of 2008.
    Examining figures from the second quarter, the highest average price
appreciation occurred in detached bungalows, which rose by 5.6 per cent to
$351,587, followed by standard two-storey properties, which rose to $418,943
(5.2%), and standard condominiums, which increased to $248,408 (3.9%),
    An extreme inventory shortage has helped pressure prices upwards in the
mid-west, while excess supply loosened markets in the previously frenzied
    While Saskatchewan's cities recorded the country's highest price gains,
Winnipeg followed closely behind. Growth in agricultural sectors, and
subsequently high levels of immigration required housing that simply could not
be met by current levels of inventory. The inevitable result of a booming
economy was observed as the markets held strongly in the sellers' favor as
house prices skyrocketed in both Saskatchewan and Manitoba.
    Despite some mild price erosion during the second quarter in both Calgary
and Edmonton, these markets remain strong. Although prices have come down from
where they were last year - one of the best years on record - current house
prices are far higher than they were three years ago, before energy-rich
Alberta experienced its boom. Relative to the rest of the country, Calgary and
Edmonton are still home to some of Canada's most expensive real estate.
    Montreal, Toronto and Ottawa all experienced strong second quarters, and
are poised to continue to see prices appreciate. In all three cities, listings
rose during the second quarter, compared to the same period last year. The
increase in inventory has translated into fewer, albeit still occurring,
multiple offer situations. Homes priced appropriately had listing periods that
often lasted one to two weeks during the second quarter; a relatively short
period of time by historical standards.
    Echoing the trend of the past few months, St. John's has become the
economic bright spot of Atlantic Canada. With various new oil projects
underway, and others to begin shortly, St. John's is experiencing housing
market conditions typically only seen in major metropolitan cities.
Skyrocketing house prices and multiple offer situations have quickly swung the
city into a sellers' market. Strong demand in the country's eastern provinces
has led to many Atlantic cities recording double-digit prices increases.

                          REGIONAL MARKET SUMMARIES

    In Halifax, strong buyer demand combined with the city's low inventory
levels created an abundance of activity during the second quarter leading to
many multiple offer situations. Buyer demand was strong during the second
quarter with all types of buyers drawn to the market. Looking ahead prices are
anticipated to increase, while unit sales are expected to decline.
    St. John's had a phenomenal second quarter, characterized by an abundance
of buyer activity, with multiple offer situations and bidding wars becoming
the norm. With various new oil projects underway, and others set to begin
shortly, the strong economy in St. John's has boosted consumer confidence
across the city. High buyer demand led to double-digit price increases in all
housing types during the second quarter. These strong conditions are
anticipated to continue over the next six months.
    The housing market in Moncton experienced a healthy second quarter, with
moderate house price appreciation expected to continue throughout the year.
The job market in Moncton is very healthy - in-migration of Moncton natives
returning from out west will continue to create activity in the real estate
market with prices increasing slightly to year's end.
    First time buyers helped boost activity in Saint John, showing a
preference for homes priced between $150,000 and $250,000. Workers returning
from the oil fields in Alberta also entered the high-end real estate market
leading to strong activity levels in this housing type during the second
    Charlottetown saw a return to a more balanced market during the second
quarter - with an increase in inventory coming on stream, ultimately
positioning the market in favour of the buyer. The stable housing market in
Charlottetown is anticipated to continue through to the end of the year.
    In Fredericton, the housing market experienced more balanced market
conditions during the second-quarter with activity in the condo market
tempering from where it was several months ago, as more of this property type
was listed on the market. Fredericton's real estate market is anticipated to
remain robust for buyers and sellers alike well into the next year.
    Montreal's housing market experienced moderate growth during the second
quarter, with average house prices inching upwards by high single-digits.
Healthy employment rates and the relatively low cost of borrowing money
continues to bolster buyer demand, and will help maintain the strength of the
market into the second half of the year.
    Toronto's real estate market is anticipated to see healthy price
appreciations throughout the remainder of 2008. The market is expected to
mirror the second quarter's conditions of rising average house prices, which
were bolstered largely by healthy buyer demand. During the second quarter, all
housing types received considerable buyer attention, with the city's upper end
properties doing extremely well. A heightened awareness of the environment, as
well as rising prices at the gas pumps, have contributed to an influx of
purchasers relocating to the city's core, placing properties near public
transit at a premium.
    The outlook for Ottawa's resale housing market is optimistic, with
average prices anticipated to rise and market activity to remain steady,
through to the end of 2008. Bolstered by the combination of a robust and
unwavering local economy, and high consumer confidence, Ottawa's real estate
market maintained its title as the country's most stable market during the
second quarter.
    In Winnipeg, limited new and resale housing inventory continued to
tighten the city's real estate market, and will do so for the remainder of
2008. The limited supply of housing throughout the city had a dramatic impact
on average house prices, which, for all housing types surveyed during the
second quarter, experienced double-digit year-over-year increases. Inventory
levels were tightened throughout Winnipeg due to an influx of provincial
in-migration, during the second quarter.
    Prosperity in both Regina and Saskatoon - generated by surging commodity
prices and market speculation - continued to fuel interest in residential real
estate throughout the province. In Regina, all housing types continued to
demonstrate their resilience in the second quarter, as even a five fold spike
in inventory levels could not dampen price appreciation. As a result, average
house prices continued to demonstrate substantial year-over-year gains.
Similar to Regina, second quarter house prices in Saskatoon continued to climb
at an exceptional, yet slightly slower rate than that of Regina's. Market
conditions appeared slightly more balanced in the second quarter, when
compared to activity in recent months. Look ahead; listing inventory will
rise, resulting in a slight period of stabilization.
    Calgary's resale housing market moderated in the second quarter of 2008 -
a trend that is expected to continue throughout the latter half of the year.
After a period of substantial growth in new housing development and
skyrocketing average house prices, Calgary's real estate market took a
collective exhale during what is typically one of the market's busiest
periods. Signs of a market in the latter stages of a hurried boom are evident
in Calgary, primarily in the city's inventory surplus; inventory levels
throughout the city will soon return to healthier levels as more speculators
move east in search of new real estate development opportunities, while
principle-asset homeowners hold onto their existing property until market
conditions once again pick-up steam.
    Inventory levels - which increased substantially in the last 12 months -
also led to a softening of Edmonton's housing market during the second
quarter. The spike in the city's housing inventory can be largely attributed
to new housing construction and market speculation, which, in recent years,
have both been rampant. The high inventory levels will dwindle into the second
half of the year, and as affordability improves, subsequent market conditions
will continue to normalize.
    In Vancouver, a spike in inventory during the second quarter simmered the
heat in the long-standing hot market, resulting in single-digit average house
prices increases for most areas examined, when compared to this time past
year. Despite the increase in listing volumes, buyer's interest remained
strong and it is anticipated that much of the inventory will be absorbed over
the next few quarters, leading to low single digit price appreciations through
to the year's end.
    Victoria's housing market continued to experience average price increases
during the second quarter, compared to the same period last year. While
average house prices continued to increase, the pace has definitely tempered
from the frenetic pace observed in previous quarters. Victoria is experiencing
a more normal and healthier real estate market.

             Survey of Canadian House Prices Second Quarter 2008
                             Average House Prices

                          Detached Bungalows         Standard Two Storey
                       Q2 2008  Q2 2007 Bungalow   Q2 2008  Q2 2007 2 Storey
    Market             Average  Average % Change   Average  Average % Change
    Halifax           $200,000 $197,667     1.2%  $271,667 $227,000    19.7%
    Charlottetown     $156,000 $147,000     6.1%  $185,000 $180,000     2.8%
    Moncton           $164,000 $142,000    15.5%  $132,000 $133,000    -0.8%
    Fredericton       $162,000 $155,000     4.5%  $197,000 $190,000     3.7%
    Saint John        $202,364 $168,500    20.1%  $285,179 $226,500    25.9%
    St. John's        $181,000 $147,000    23.1%  $249,333 $206,667    20.6%
    Atlantic          $177,561 $159,528    11.3%  $220,030 $193,861    13.5%
    Montreal          $234,352 $220,106     6.5%  $336,443 $320,946     4.8%
    Ottawa            $316,167 $303,083     4.3%  $315,750 $299,667     5.4%
    Toronto           $436,782 $400,025     9.2%  $564,228 $534,325     5.6%
    Winnipeg          $233,800 $207,750    12.5%  $257,800 $226,714    13.7%
    Regina            $278,850 $204,000    36.7%  $254,000 $181,917    39.6%
    Saskatoon         $340,375 $281,250    21.0%  $388,000 $305,000    27.2%
    Calgary           $438,122 $459,889    -4.7%  $437,744 $465,678    -6.0%
    Edmonton          $320,000 $374,143   -14.5%  $348,571 $397,857   -12.4%
    Vancouver         $857,500 $787,750     8.9%  $953,250 $875,750     8.8%
    Victoria          $450,000 $382,000    17.8%  $470,000 $414,000    13.5%
      National        $351,587 $333,044     5.6%  $418,943 $398,322     5.2%

                         Standard Condominium
                       Q2 2008  Q2 2007    Condo
    Market             Average  Average % Change
    Halifax           $154,500 $145,000     6.6%
    Charlottetown     $120,000 $100,000    20.0%
    Fredericton       $126,000 $130,000    -3.1%
    Saint John        $119,191
    St. John's        $193,333 $153,333    26.1%
    Atlantic          $142,605 $132,083     8.0%
    Montreal          $204,942 $195,717     4.7%
    Ottawa            $203,667 $191,667     6.3%
    Toronto           $311,026 $284,237     9.4%
    Winnipeg          $144,614 $117,260    23.3%
    Regina            $190,000 $118,300    60.6%
    Saskatoon         $236,000 $205,000    15.1%
    Calgary           $285,033 $300,078    -5.0%
    Edmonton          $226,000 $263,333   -14.2%
    Vancouver         $455,750 $419,250     8.7%
    Victoria          $295,000 $260,000    13.5%
      National        $248,408 $239,179     3.9%

    The Royal LePage Survey of Canadian House Prices 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, and current
figures will be updated following the end of the second quarter. A printable
version of the second quarter 2008 survey will be available online on August
15, 2008.
    Housing values in the Royal LePage 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 over 14,000 agents and
sales representatives in 600 locations across Canada. Royal LePage is managed
by Brookfield Real Estate Services, and is part of a brand family that
includes Royal LePage, Johnston and Daniel, Realty World and La Capitale. An
affiliated company, Brookfield Real Estate Services Fund, is a TSX listed
income trust, trading under the symbol "BRE.UN."
    For more information visit or

For further information:

For further information: For the regional market highlights or to
contact a spokesperson, please contact: Tiffany Fisher, Mansfield
Communications Inc., Phone: (416) 599-0024 ext. 222, or E-mail:

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