Higher inventory levels create challenging environment for sellers
OTTAWA, July 9, 2013 /CNW/ - The Royal LePage House Price Survey and Market Survey Forecast released today showed little change in prices for all housing types surveyed in Ottawa.
Standard two-storey houses saw a modest year-over-year increase of 1.8 per cent to $398,983 and detached bungalows increased by 1.9 per cent to $396,483. The average price of a standard condominium decreased marginally, with a 0.1 per cent decline to $259,417.
"Higher inventory levels have provided buyers with strong options and increased buying power," said John Rogan, broker and manager of Royal LePage Performance Realty. "Buyers are making conditional offers and placing increased scrutiny on home inspections. The number of signed deals failing to close has increased by approximately 15 per cent in the last year."
Rogan also noted that buyers have become more hesitant due to economic concerns. "Although the economy is in recovery, buyers remain cautious about jumping back in. They want to be more certain of the direction of the market before committing."
Looking ahead to the end of 2013, Royal LePage forecasts a modest 1.2 per cent price appreciation in the Ottawa housing market, with rising inventory levels preventing rapid jumps in prices.
Nationally, in the second quarter, standard two-storey homes and detached bungalows both showed a year-over-year average price increase of 2.7 per cent to $419,614 and $386,547, respectively. Average prices for standard condominiums showed a more modest increase during the same period, rising 1.2 per cent to $248,750. Royal LePage forecasts that house prices will see modest gains throughout the remainder of 2013, projecting a 3.0 per cent increase for the full year when compared to 2012.
Dialogue concerning the direction of Canada's housing market has remained front and centre in recent months. Changes to Canada's mortgage lending rules in mid-2012 coupled with concerns about consumer debt levels, housing affordability in cities like Toronto and Vancouver and continued international economic uncertainty have prompted a number of analysts to forecast large downward price adjustments.
"As we have stated consistently since the current market downturn began late in the second quarter of 2012, this is a normal cyclical correction which brings fewer home sales and softer prices. Those hoping their predictions of a bursting bubble and cataclysmic drops in home values will come true are out of luck again," said Phil Soper, president and chief executive of Royal LePage. "Price appreciation in most markets across the country has been well below the long-term average for Canada and will remain so through to the end of the year. We expect to see the number of homes trading hands to begin to rise slightly on a year-over-year basis in the second half of 2013, with price softness continuing until mid-2014, at which point we'll see an emergence from the current cycle."
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 website at www.royallepage.ca. Current figures will be updated following the complete tabulation of the data for the second quarter of 2013. A printable version of the second quarter 2013 survey will be available online on August 6, 2013. 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 14,500 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 and 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.
SOURCE: Royal LePage Real Estate Services
For further information:
Kaiser Lachance Communications
Director, Global Communications & Public Relations
Royal LePage Real Estate Services