Increased buyer activity in early 2010 impacts sales in last two quarters

TORONTO, Jan. 6 /CNW/ - The Royal LePage House Price Survey and Market Survey Forecast released today showed modest year-over-year price appreciation across all three housing types surveyed in Toronto.

On average, standard two-storey homes witnessed the largest year-over-year price increase climbing 5.6 per cent to $594,321. Standard condominiums rose 3.8 per cent to $331,525, while prices for detached bungalows increased by 3.1 per cent to $481,733.

"Sales in 2010 were front-end loaded. Buyers hastened to the market in the first half of last year anticipating interest rate hikes and HST," said Gino Romanese, senior vice president, Royal LePage Real Estate Services Ltd. "This distortion to the normal seasonal curve had the effect of reducing sales in the second half of last year. We are predicting another strong market in 2011. While sales are expected to be down 5.9 per cent, to 83,000 units, it remains above Toronto's ten year unit sales average." According to Romanese, limited inventory sparked multiple offers on well-priced homes in desirable areas. However, Romanese added, on average sellers are receiving just under their asking price.

"We are predicting a 1 per cent increase in the average house price in Toronto during 2011," added Romanese. The market remains strong as consumer confidence is returning and interest rates are expected to stay relatively flat for at least the first half of the year. Rising inventories coupled with reduced affordability brought about by higher average prices will temper activity somewhat in 2011, keeping a lid on price increases this year.

Nationally, the average price of a home increased between 3.9 and 4.6 per cent in the fourth quarter of 2010, compared to the previous year, as markets shrugged off a lackluster third quarter and returned to a post-recession growth profile. Home values are forecast to continue a moderate and steady climb in many of the country's key housing markets through 2011 with sales activity skewed to the first half of the year.

"Trends in the housing market continue to be driven by the lingering after-effects of the recession," said Phil Soper, president and chief executive of Royal LePage Real Estate Services. "Canadians realize that interest rates are unsustainably low and that homes will become effectively more expensive when mortgage rates return to normal levels. We will likely see more price appreciation early in 2011 as some buyers complete transactions in advance of anticipated higher borrowing costs."

Across Canada, the average price of a home is forecast to rise 3 per cent over the coming year to $348,600 while the number of transactions is expected to drop 2 per cent.

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  Current figures will be updated following the complete tabulation of the data for the fourth quarter 2010. A printable version of the fourth quarter 2010 survey will be available online on February 4th, 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.  Historical data is available for some areas back to the early 1970s.

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.

SOURCE Royal LePage Real Estate Services

For further information:

Michael Gotzamanis     
Fleishman-Hillard Canada

Tammy Gilmer
Director, Public Relations and National Communications
Royal LePage Real Estate Services

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