Second Quarter Royal LePage House Price Survey
Second Quarter Royal LePage House Price Survey:
Canadian Real Estate Market Shows Signs of a Sustainable Recovery with Modest Price Gain of 1.1% in Second Quarter
- Nationally, home prices expected to rise modestly by 0.4% by the end of 2019 compared to 2018, driven by gains in Toronto and Montreal
- Condominium prices in Vancouver decline for first time since third quarter of 2014
- New federal government programs expected to have minimal impact on home prices
TORONTO, July 10, 2019 – According to the Royal LePage House Price Survey released today, low interest rates and healthy employment have offset the market drag caused by widespread economic uncertainty that has kept monthly unit sales volumes below the ten-year average leading to very modest home price appreciation at the national level.
The Royal LePage National House Price Composite, compiled from proprietary property data in 63 of the nation’s largest real estate markets, showed that the price of a home in Canada increased 1.1 per cent year-over-year to $621,696 in the second quarter of 2019. When broken out by housing type, the median price of a two-storey home rose 1.0 per cent year-over-year to $727,165, while the median price of a bungalow dipped 0.4 per cent year-over-year to $516,048. Condominiums remained the fastest growing housing type on a national basis, with its median price rising 3.8 per cent year-over-year to $452,451.
“We now have evidence of a sustained market recovery in some of the nation’s largest markets, and signs of a price floor in other regions hit hard by the eighteen month-old housing correction,” said Phil Soper, president and CEO, Royal LePage. “Only in the West do we see a significant number of home buyers remaining on the sidelines, depressing sales volumes and causing prices to sag. Buoyed by supportive economic conditions, many stubborn homeowners in B.C. and Alberta remain unwilling to let their precious real estate go for less than what they perceive as fair value, which has gone a long way to protecting existing home values.”
Canada’s economy continues to grow, albeit at an unexceptional pace, with a slumping housing market being a major contributor to the slowdown. Offsetting this, business investment has picked up considerably, helping to sustain a period of exceptional employment growth, particularly in British Columbia, Ontario, and Quebec.
Trade tension continues to weigh on consumer confidence and housing market health. A recent detente in Chinese-American relations, and a stronger than expected mid-year employment picture has muted some of the U.S. recession talk. While a rate cut by the Federal Reserve is still a possibility, a similar move by the Bank of Canada is less likely. Lower rates south of the border and a stronger American economy would have positive implications for exports and Canadian consumer and business confidence.