Royal Le Page says that 2017 was the year of the condo as affordability issues made them more affordable in the priciest markets compared to other property types.
The brokerage’s National House Price Composite, tracking house prices in 53 of Canada’s largest housing markets, showed a 10.8% year-over-year rise year in the median price of a home to $626,042 in Q4,2017.
The median price of a two-storey home was $741,924, up 11.1% year-over-year-over-year, while bungalows were up 7.1% to $522,963.
Condos though were up to a median $420,823, a 14.3% annual rise, while these properties in the Greater Toronto Area jumped 19.5% to $476,421 (19.6% in the City of Toronto to $515,578).
In Greater Vancouver, the median price of a condo was up 20.2% to $651,885 (18.7% to $775,806 in the City of Vancouver).
“To prospective homeowners in our largest cities, condominiums represent the last bastion of affordability,” said Phil Soper, president and CEO, Royal LePage. “This is especially true for first-time buyers whose purchasing power has been reduced by tightening mortgage regulations.”
“The unsustainably high rates of home price appreciation witnessed in recent years in B.C. and Ontario were dangerous to the stability of not only the housing market, but to the broader economy itself,” continued Soper. “Policy measures like the OSFI stress test will quell runaway housing inflation to an extent. However, we do foresee an upswing in demand in the latter portion of the year, as prospective buyers adjust to the new realities. To put it another way, the demand is still there.”
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Home prices slowed generally in the fourth quarter of 2017 but the condo sector, especially in the GTA and Vancouver, outpaced the market.