Home prices up nationally, but gains will soon slow: Royal LePage

The national average price in the second quarter of 2011 for a standard two-storey home rose 6.1% since last year to reach $390,163. The price of a standard condominium rose 3.5% to $238,064, and a detached bungalow rose 7.5% year-over-year to $356,625.

The price increase in many markets went beyond the gains in earnings of residents, said Phil Soper, president and chief executive at Royal LePage.

“In many of Canada’s regional markets, we saw house prices appreciate at a significantly faster rate than wages and salaries, and this trend cannot continue significantly,” he said, adding price gains will moderate in the second half of 2011 and beyond.

“Looking ahead to 2012, signs are pointing to stability for Canadian home owners and new buyers,” said Soper. “We believe we are past the peak house price appreciation.”

The largest gain for a single-family home price was in Regina, where it jumped 15.6% to reach $300,000 from $259,500 in the second quarter of 2010. That gain has been tied to a tight inventory that’s been unable to meet the growing housing demand, said the report. Vancouver was not far behind, rising 12% to reach $1.1 million, compared to $995,250 a year earlier.

“Vancouver, and specifically certain neighbourhoods in the lower mainland of British Columbia, remains an anomaly, as investment from outside the country continues to support higher price levels,” Soper said.

The influence of Chinese investors has been specifically tabbed for the rise in Vancouver, although statistics have yet to confirm the anecdotes of larger numbers of overseas Chinese buyers.

Not all markets rose in price, however. Calgary saw two-storey homes down 1.6% to an average of $415,200, bungalows drop 2% to reach $411,678, and condos down 1.1% to reach $249,022. Two-storey homes were also down 1.3% in Moncton to $137,500, down 1.2% in Victoria to $477,000 and down 0.5% in Saskatoon to $353,750.

Below are some of the standard two-storey changes since last year for Canadian cities:

  • Halifax: +5%
  • Charlottetown: +0.5%
  • Moncton: -1.3%
  • Fredericton: +1.5%
  • Saint John: +4%
  • St. John’s: +2%
  • Montreal: +7.1%
  • Ottawa: +5.2%
  • Toronto: +4.7%
  • Winnipeg: +4.6%
  • Regina: +15.6%
  • Saskatoon: -0.5%
  • Calgary: -1.6%
  • Edmonton: +0.4%
  • Vancouver: +12%
  • Victoria: -1.2%

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