• December 13, 2017

•  Impact of new stress test expected to be contained to first half of 2018 for most major markets
• Still risk of high price appreciation in Greater Toronto Area and Greater Vancouver as chance of market correction fades
• Compounding policies could have unintended consequences for struggling housing markets

TORONTO, December 13, 2017 – According to the Royal LePage Market Survey Forecast released today, the Royal LePage House Price Composite, which measures home prices in 53 key Canadian cities, is expected to increase 4.9 per cent by the end of 2018 to $661,919, in the face of a series of measures aimed at affordability challenges in Greater Vancouver and the Greater Toronto Area.

One of the most significant regulatory interventions in the housing industry in years is the incoming Office of the Superintendent of Financial Institutions (OSFI) mortgage financing stress test, which will take effect on January 1, 2018. The stress test targets existing and prospective homeowners applying for a mortgage, requiring them to meet stricter criteria when seeking new financing.

With a large number of existing homeowners potentially failing the test when refinancing next year, a temporary reduction in consumer confidence may further stagnate price growth as potential buyers and sellers take a ‘wait and see’ approach. Moreover, some potential move-up buyers will likely delay listing their homes as they will not be able to access sufficient financing for their desired next purchase. With further diminished affordability, it is likely that demand for entry-level properties will surge. In most urban centres, this will be most evident in the condominium segment.

“It is prudent that policy makers introduce measures that help protect the housing market from runaway price inflation,” said Phil Soper, president and CEO, Royal LePage, “However, natural supply and demand forces will always triumph over regulatory tinkering. Attempting to use public policy to steer property prices in huge, rapidly growing cities like Toronto and Vancouver is like a tugboat trying to turn an ocean liner. Consistent, measured policy can have a positive impact. Just don’t try to turn the market on a dime or you risk sinking the ship.”

“Insufficient housing supply in Canada’s largest cities will begin to drive significant price increases to higher than normal levels once the market adjusts to the new stress test,” continued Soper. “Aggressive home price inflation is still more of a threat today than the risk of a market crash in Toronto or Vancouver. On the other side of the coin, regions where demand is soft and already struggling to absorb the supply of homes for sale may have difficulty adjusting to these measures.”

Decreasing, or already low, inventory levels are expected to continue to define market characteristics of many large urban centres including the Greater Toronto Area, Greater Vancouver, Ottawa and Montreal. Further adding to the already bloated housing demand backlog, British Columbia and Ontario both experienced a surge in interprovincial migration in 2017, putting increased pressure on Greater Vancouver and the Greater Toronto Area housing markets. Demand from immigration, alongside demand from Peak Millennials[1] who are increasingly becoming of homebuying age, will continue to outpace supply.

“Royal LePage’s research into Peak Millennials[2] shows that younger Canadians desire to own their own homes with the same conviction as their parents before them,” said Soper. “Eighty-seven per cent see real estate as a good financial investment. The tight rental market is reflective of their dreams sitting on hold while they save for a downpayment. Of course there will be those who are priced out of a market altogether. They will continue renting and this will drive demand for investor properties.”

According to a recent Royal LePage Advisor Survey[3] on rental demand, 76 per cent of Royal LePage agents who offer rental services in the Greater Toronto Area saw a year-over-year increase in multiple offers and 68 per cent of those respondents cited affordability as a barrier to homeownership as the number one factor driving rental demand. In Greater Vancouver, 59 per cent of respondents servicing the Vancouver area saw a year-over-year increase in multiple offers for rentals. As a result, the pipeline of potential homebuyers providing a market price floor is growing and this growth trend is expected to continue through 2018.

Canada’s economy is expected to expand by 2.1 per cent in 2018, with all provinces, with the exception of Newfoundland, expected to see growth. Economic growth is an important driver of healthy housing markets.

“Most Canadians know how important the resource sector is to our economy but fewer understand just how important the real estate industry is to Canada,” said Soper. “In 2016, 13 per cent of the country’s GDP was driven by real estate. In British Columbia, that number was closer to 18 per cent.”

“When people are confident about their jobs and optimistic about the health of their country and their city, they will invest in a home,” Soper concluded. “At projected levels of demand, Canadian housing is poised for growth for years to come.”

Regional Pricing Forecasts (Listed by population size) 

Greater Toronto Area

Home prices in the Greater Toronto Area are expected to increase 6.8 per cent in 2018, rising to an aggregate[4] price of $901,392. This will largely be driven by price appreciation in the condominium market as demand for entry-level properties is expected to continue to surge. The Greater Toronto Area’s thriving economy and growing population has been supportive of an expanding housing market and this is expected to continue throughout 2018.

As a result of the incoming OSFI stress test, sales for detached properties are expected to soften in the first half of the year as both buyers and sellers adjust their price expectations. However, sales volumes for the full year are expected to remain at a similar pace as 2017.

“Relative to recent years, 2018 is expected to be a good year for buyers and this is a continuation from what we are currently seeing in the market today,” said Shawn Zigelstein, sales representative, Royal LePage Your Community Realty. “While the condo market should continue to see price growth from high demand, buyers looking at detached properties in the first quarter will be able to ask for conditions, have a much greater selection and should be competing against fewer multiple offers.”

Greater Montreal Area

Home prices in the Greater Montreal Area are expected to increase 5.5 per cent in 2018, rising to an aggregate price of $408,285. Among the economic factors supporting the Montreal real estate market momentum is ongoing employment growth seen across the region. In November, the province reached its lowest unemployment rate since January 1976, at 5.4 per cent, while Montreal recorded a 6.6 per cent rate during the same period. According to the Conference Board’s Consumer Confidence Index for Quebec[5], the proportion of Quebecers who feel that it is a good time to make a major purchase, such as a property, increased in November to 45.6 per cent, an unprecedented rate in more than 10 years.

Purchases made by foreign buyers in high-end neighbourhoods such as downtown, Westmount and Ville Mont-Royal are expected to continue. The strong local economy and relative affordability are credited for driving consumer demand from this demographic.

“The economic health of Montreal continues to positively affect real estate transactions in the area,” says Dominic St-Pierre, senior director, Royal LePage, for the Quebec region. “We are confident that the market will remain stable and strong within the next year. Our forecast takes into account that the upcoming OSFI stress test, as well as potential interest rates hikes, may cool down the housing market during the first half of 2018.”

Greater Vancouver

Home prices in Greater Vancouver are expected to increase 5.2 per cent in 2018, rising to an aggregate price of $1,353,924 as low supply continues to put upward pressure on the housing market. Further enhancing the housing market is British Columbia’s economy, which is poised to be a top performer among the provinces in 2018. One potential risk to the region’s housing market is further interest rate hikes as home prices are substantially higher in this region when compared to other Canadian markets. Interest rate hikes generally put upward pressure on the Canadian dollar, which also stifles interest from foreign buyers.

A trend that is expected to continue to strain the housing market is the hesitation from homeowners to put their properties on the market in fear that they will not be able to find another property. This will be amplified by the incoming OSFI stress test as some potential move-up buyers may not qualify for financing a new property. This lack of movement is expected to further constrain the supply of entry-level properties.

“We are watching how the new OSFI stress test will impact the Greater Vancouver market,” said Randy Ryalls, general manager, Royal LePage Sterling Realty. “Low inventory will continue to put upward pressure on prices. However, with the introduction of the stress test, as well as other factors such as potential interest rate hikes, price growth will likely be limited to mid-single digits.”

Ottawa

Home prices in Ottawa are forecast to increase 3.2 per cent in 2018, rising to an aggregate price of $458,208, reflecting the strong economic growth anticipated in the region through next year. Currently, housing inventory in the Ottawa market is very low and this trend is expected to continue throughout 2018, putting upward pressure on home prices.

As demand in the region is exceptionally high, the incoming OSFI stress test is expected to be quickly absorbed, limiting impacts on both home sales and prices.

“Ottawa is known for its steady growth and we expect consumer confidence to remain high throughout 2018,” said Hanna Browne, broker, Royal LePage Team Realty. “Most buyers who migrate to Ottawa have found employment locally prior to arriving, however, we are still seeing a surge of demand from buyers employed in Toronto who have the ability to work remotely full or part-time.”

Calgary

Home prices in Calgary are forecast to increase 2.3 per cent in 2018, rising to an aggregate price of $494,109 as the region further emerges from recovery. The region’s housing market has been supported by stabilizing oil prices and improving employment rates. While it could take several years for the economy to improve to pre-downturn levels, Alberta is poised to be one of the fastest growing economies in 2018. In turn, this will likely further improve consumer confidence. While the energy sector will continue to be the most important factor influencing the housing market, the region has seen growth in non-energy sectors helping to mitigate risk through a more diversified economy.

Though the incoming OSFI stress test is expected to slow sales at the beginning of the year, buyers and sellers are expected to adjust, and the delayed market could result in brisker sales beginning in late spring, potentially finishing strong at the end of the year.

“Continued strong competition for homes priced between $400,000 and $500,000, coupled with the incoming OSFI stress test, will likely push first-time buyers into the condo segment where they have ample selection at affordable prices,” said Corinne Lyall, broker/owner, Royal LePage Benchmark. “One positive impact of the measure may be that it will improve the health of the condominium market.”

Edmonton

The aggregate home price in Edmonton is expected to decrease 1.5 per cent in 2018 and end the year at $382,180. While Edmonton’s economy has stabilized, the region has not seen a significant improvement in employment, which is needed to lift home prices. On a positive note, the Conference Board of Canada is predicting Edmonton to show modest but sustainable GDP growth of 2.2 per cent in 2018.[6]

Although the impact of the OSFI stress tests is expected to be less pronounced compared to previous measures targeting first-time buyers, sales in the beginning of the year will be slower as move-up buyers who do not meet new financing criteria temporarily move to the sidelines. However, sales for the full year are expected to be similar or slightly higher compared to 2017 levels.

“The best advice I can give a seller in Edmonton is to make sure your pricing is very accurate,” said Tom Shearer, broker and owner, Royal LePage Noralta. “A trend we will continue to see in 2018 as we remain in a buyer’s market, is heightened price sensitivity. Buyers expect to negotiate within 2 to 3 per cent, and if you are outside that range they just move on.”

Winnipeg

Home prices in Winnipeg are expected to increase 4.0 per cent in 2018, rising to an aggregate price of $315,120. The region’s economy has benefitted from an increase in population and a low unemployment rate, which are expected to continue to put upward pressure on home prices and help maintain strong sales activity consistent with 2017 levels.

Strong demand for housing and low inventory is expected to continue through 2018, mitigating the dampening effect of the incoming OSFI stress test and limiting its impact to the first quarter.

“New regulations often create a ‘wait-and-see’ approach as buyers and sellers try to determine the long term impact,” said Michael Froese, managing partner, Royal LePage Prime Real Estate. “The strength of our economy and housing affordability are much more significant in determining the health of our real estate market than the expected impact from the incoming OSFI stress test.”

Halifax

Home prices in Halifax are expected to increase 2.5 per cent in 2018, rising to an aggregate price of $326,975. The region’s economy has been expanding and the manufacturing sector, a key indicator for the region, is expected to continue growing through 2018. The region’s housing market has benefitted from both population and job growth. Inventory in the downtown core is expected to remain low and sales are expected to increase modestly by the end of 2018.

“We don’t expect the incoming OSFI stress test to have a significant effect on Halifax’s housing market. Homes are affordable and buyers rarely extend themselves,” said Matt Honsberger, president, Royal LePage Atlantic. “Our economy is a good news story and we expect that it will be the biggest driver of price appreciation in 2018.”

Regina

Home prices in Regina are expected to increase 0.7 per cent in 2018, rising to an aggregate price of $329,289. Employment from a modestly improving energy sector and international immigration is expected to put upward pressure on both home prices and sales. However, a net loss from interprovincial migration and a surplus of inventory will keep price appreciation at a modest pace. The region continues to be heavily reliant on potash and energy. Any improvement in either sector could lift home prices in 2018.

“The region is expected to remain a buyer’s market throughout 2018. Home sellers need every available tool to properly market their home if they want to sell this coming year,” said Mike Duggleby, broker and managing partner, Royal LePage Regina Realty. “The most important factor to get right is pricing. Buyers have enough selection that they won’t consider a property that isn’t already priced in a competitive range.”

Royal LePage Market Survey Forecast 

Download Chart (.pdf)

About the Royal LePage Market Survey Forecast

The Royal LePage Market Survey Forecast provides year-over-year price expectations for Canada’s nine largest markets. Housing values are based on the Royal LePage National House Price Composite, produced through the use of company data in addition to data and analytics from its sister company, RPS Real Property Solutions, the trusted source for residential real estate intelligence and analytics in Canada. Commentary on housing and forecast values are provided by Royal LePage residential real estate experts, based on their opinions and market knowledge.

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 almost 18,000 real estate professionals in more than 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 symbol TSX:BRE.

For more information visit: www.royallepage.ca.

Forty per cent of real estate advisors believe that American inquiries will continue to climb after Donald Trump assumes power

Canada’s reputation surges in international rankings

January  2017 – According to data released today by Royal LePage, Canada’s leading real estate services provider, American interest in Canadian real property has risen following the U.S. Presidential Election, with an increased number of Americans conducting research into real estate markets across the nation.

American web traffic on royallepage.ca, the company’s consumer real estate portal, has been hig

hly correlated to recent U.S. political events. U.S.-originated sessions surged 329.0 per cent the day following the election and climbed 210.1 per cent year-over-year the week after Donald Trump’s victory. Looking at the full month of November, 2016, U.S. web traffic grew 73.7 per cent year-over-year, when compared to the same period in 2015. This trend continued throughout the remainder of 2016, with American web traffic rising by 40.9 per cent year-over-year during the fourth quarter[1].

According to a new Canada-wide survey of 1,226 Royal LePage real estate advisors, U.S. interest in Canadian real property will continue to climb, with 39.5 per cent of respondents forecasting that American inquiries into Canadian real estate will rise under President Donald Trump. In the fourth quarter of 2016 – of which November and December are traditionally quieter times for North American real estate activity – 15.6 per cent of the advisors polled received inquiries from south of the border.

“Always a desirable destination for migrants, Canada’s attractiveness as a country for international relocation has surged this decade,” said Phil Soper, president and chief executive officer, Royal LePage. “The United States was already a top source for immigration into Canada, and now in the period following the recent U.S. election, we are witnessing a material bump in American interest in Canadian real estate.”

During the fourth quarter of 2016, American interest was primarily focused on Canada’s largest markets, with Ontario, British Columbia and Quebec receiving 72.7 per cent of all U.S. regional page views generated on royallepage.ca. Those looking to purchase Canadian real property were largely interested in the country’s residential market, with three quarters (75.2 per cent) of all American inquiries pertaining to this market segment.

“U.S. interest in Canadian real estate is not a new phenomenon –– we are next door neighbours,” said Soper. “From Whistler to Muskoka; to Tremblant and Nova Scotia’s south shore, Americans have traditionally been the largest foreign cohort of recreational property purchasers in Canada. With our country’s ever-growing global reputation as a financially sound, happy and culturally tolerant place to raise a family, it is not surprising that interest has moved from a place to play, to a potential place to live and work.”

“Given America’s vast population, even a fractional increase in the number of households following through on this initial interest and successfully completing the demanding process of  emigrating to Canada could drive a material increase in the number of home-buyers from south of the border,” concluded Soper. “Our federal government is seriously considering increasing the quota of new Canadians welcomed from abroad, and with the high value of the U.S. dollar increasing Americans’ purchasing power, we may be seeing more moving trucks with U.S. license plates in our future.”

In last year’s inaugural “Best Countries” ranking published by US News in partnership with BAV and the Wharton School, Canada was ranked second worldwide in the comprehensive 75 element study, scoring very high on culture, sustainability, entrepreneurship and open-for-business categories. In the United Nations’ “Global Happiness Ranking,” Canadians scored sixth place. Additionally, the Economist’s widely followed “Most Liveable Cities” analysis, which ranks cities based on a balance of economic, safety and environmental factors, placed Vancouver, Toronto and Calgary in three of the top five spots worldwide, with no U.S. city ranked in the top ten.

Provincial Summaries and Trends

Ontario led the country as the top-researched destination by Americans on royallepage.ca in the fourth quarter of 2016, with 41.4 per cent of U.S. regional page views directed to the province. Over the same period, Ontario listings received a significant boost in U.S. page views, rising 54.5 per cent this year over last. According to the survey, 62.5 per cent of real estate advisors polled in Ontario cited the Greater Toronto Area (GTA) as the most desirable location for U.S. parties making inquiries into a home purchase since October 2016, while just over two-thirds (67.2 per cent) pointed to the GTA as the region in which Americans purchased the most property over the same period of time. Looking ahead, 38.4 per cent of survey respondents from Ontario expect U.S. inquiries into Canadian real estate to increase following Donald Trump’s assumption of power.

In the fourth quarter of 2016, British Columbia accounted for 17.4 per cent of U.S. regional page views, while also showing a 62.9 per cent increase year-over-year. Interestingly, according to the survey, Victoria garnered the most attention among B.C. cities from prospective U.S. home-buyers, being cited as the preferred location by approximately one third (32.1 per cent) of respondents. In comparison, one quarter (25.0 per cent) of respondents cited Greater Vancouver as the top region of interest among American home-buyers considering a real estate purchase in B.C. Looking ahead to 2017, 43.6 per cent of B.C. respondents anticipate American inquiries into Canadian real estate will increase after Donald Trump takes office.

U.S. traffic to Royal LePage’s Quebec listings accounted for 13.9 per cent of the total website sessions logged across provinces in the fourth quarter of 2016, and showed a 17.6 per cent increase in U.S. page views, year-over-year.  Meanwhile, the survey found that 40.0 per cent of Quebec respondents named the Greater Montreal Area as the main market in Quebec that Americans considered for a potential property purchase. In looking at property acquisitions by Americans since October 2016, of those polled in Quebec, over one half (53.3 per cent) of real estate advisors who sold a home to an American did so in the Greater Montreal Area, while 20.0 per cent sold a home in each of Quebec City and Mont-Tremblant. When Donald Trump takes office, 52.2 per cent of Quebec respondents believe the region will see an increase in U.S. inquiries in the period that follows.

Despite accounting for a smaller percentage of U.S. website traffic provincially (7.4 per cent in Nova Scotia; 5.7 per cent in New Brunswick; 2.3 per cent in Prince Edward Island; and 2.1 per cent in Newfoundland and Labrador), according to real estate advisors surveyed, Atlantic Canada saw the highest percentage of sales inquiries from Americans since October 2016. In fact, during the fourth quarter, Royal LePage’s data showed a year-over-year increase in U.S. website sessions of 180.4 per cent, 125.5. per cent, 53.4 per cent and 41.7 per cent for New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador, respectively.  Over one quarter (27.9 per cent) of survey respondents indicated that Americans have expressed interest in a property in the Atlantic region since October 2016, with a large majority of inquiries (54.8 per cent) and purchases (54.2 per cent) taking place in Halifax. Furthermore, almost half (48.1 per cent) of those surveyed in the region expect inquiries to increase after Donald Trump assumes power.

Provinces affected by recent economic downturns saw minimal interest from American buyers, with U.S website sessions for Alberta accounting for only 7.6 per cent of the total. The survey showed that, of those interested in Alberta, Calgary (54.6 per cent) and Edmonton (27.3 per cent) were cited by respondents as receiving the most interest from potential U.S. buyers. Notably, all (100 per cent) survey respondents working in the region indicated that they have not sold a home to an American since October 2016 – the only region in the country to report zero U.S. real estate transactions for this period. Similarly, only 26.4 per cent of respondents believe the region will see an increase in real estate inquiries by Americans after Donald Trump takes office.

The other provinces in the Prairies saw the least amount of interest by prospective American homeowners since October 2016, with only 1.6 per cent of U.S. website sessions being associated with Manitoba and 0.5 per cent with Saskatchewan. According to survey respondents, of the U.S. buyers interested in these provinces, Americans mostly inquired about property purchases in Winnipeg (50.0 per cent), Saskatoon (20.0 per cent) and rural Saskatchewan (15.0 per cent). Looking ahead, one third (33.3 per cent) of respondents expect to see an increase in American inquires after Trump assumes power.

Home sales and listings just below 10-year average

Caring for our neighbours

November 14 - 21, 2016

Each year our volunteers collect donations of blankets and warm clothing for those in need throughout the Lower Mainland.

Since we began 22 years ago, more than 290,000 disadvantaged people have been helped by the REALTORS Care® Blanket Drive.

How you can help

Please donate the following items for all ages:

  • gently used or new blankets or sleeping bags
  • warm clothing, coats
  • hats, gloves, scarves
  • new socks and underwear

A list of drop-off locations will be posted closer to the date.

Metro Vancouver* home sales dipped below the 10-year monthly sales average last month. This is the first time this has occurred in the region since May 2014.

The federal government announced regulation changes for new government-backed insured mortgages today. Effective October 17, 2016, insured homebuyers will have to qualify at the posted five-year qualifying rate. Previously, only variable rate mortgages and mortgages with terms less than five years were subject to a higher qualifying rate.

The qualifying rate is updated weekly and available on the Bank Of Canada website. The current rate is 4.64 per cent, about 200 basis points higher than the best bank offered rates. 

To qualify for mortgage insurance, a homebuyer's debt servicing ratio must be no higher than: 

• Gross Debt Service – 39 per cent of household income, including mortgage payment, taxes, and heating costs.

• Total Debt Service – 44 per cent of household income, including mortgage payment, taxes, heating costs, and all other debt payments 

These changes will apply to new mortgage insurance applications received on October 17, 2016 or later. Mortgage insurance applications received after October 2, 2016 and before October 17, 2016 are also not affected by the rule change, provided that the mortgage is funded by March 1, 2017. Homeowners with an existing insured mortgage or those renewing existing insured mortgages aren’t affected by this measure.

These changes also won’t apply to mortgage loans where: 

• the lender made a legally binding commitment to make the loan; 

• the borrower entered into a legally binding agreement for the property against which the loan is secured. 

The federal government is also instituting new eligibility rules for low-ratio (higher than 20 per cent down payment) mortgages backed by government insurance. As of November 30, 2016, to be eligible for government insurance, new mortgages must meet the following requirements: 

1. A loan whose purpose includes the purchase of a property or subsequent renewal of such a loan; 

2. A maximum amortization length of 25 years;

3. A maximum purchase price below $1,000,000 when the loan is approved;

4. For variable-rate loans that allow fluctuations in the amortization period, loan payments that are recalculated at least once every five years to conform to the original amortization schedule; 

5. A minimum credit score of 600 at the time the loan is approved;

6. A maximum Gross Debt Service ratio of 39 per cent and a maximum Total Debt Service ratio of 44 per cent at the time the loan is approved, calculated by applying the greater of the mortgage contract rate or the Bank of Canada conventional five-year fixed posted rate; and,

7. A property that will be owner-occupied.

These new criteria, in particular requiring a maximum purchase price below $1 million, will essentially make the majority of single family homes in Metro Vancouver ineligible for government issued insurance for low-ratio mortgages. 

The government also announced measures to ensure that the exemption from capital gains tax on the sale of a principal residence is available only in appropriate cases.

Reprinted with permission from the REBGV

For more details, just call us...

BCREA ECONOMICS NOW

Bank of Canada Interest Rate Announcement - July 13, 2016

The Bank of Canada announced this morning that it is holding its target for the overnight interest rate at 0.5 per cent. In the press release accompanying the decision, the Bank noted that inflation is on track to return to its target of 2 per cent by 2017, though heightened global uncertainty presents a risk to that forecast.  The Bank judges the overall risks to its forecast as roughly balanced, but noted financial vulnerabilities are elevated in the greater Vancouver and Toronto areas due to rising home prices. 

Economic growth in Canada appears to be slowing as expected in the second quarter.  Our tracking estimate of second quarter real GDP growth is currently at -0.5 per cent following a strong start to the year. Most of the slowdown is due to disruptions caused by the Alberta wildfires which points to a strong rebound as oil production comes back on-line and the reconstruction effort begins. That rebound will be further supported by a boost of fiscal stimulus planned for the second half of the year. An improved outlook for growth and firm but low trend inflation probably rule out any further rate cuts from the Bank, particularly given that long-term interest rates have already fallen to near record lows in recent weeks.  Our forecast remains that the Bank will be sidelined for the remainder of 2016 and through most if not all of 2017.

 “Copyright British Columbia Real Estate Association. Reprinted with permission.”

Canada’s residential real estate market posts strongest growth in five years in the second quarter of 2016

Central bankers expected to keep interest rates lower for longer in light of Brexit and global uncertainty

TORONTO, July 13, 2016 – Canada’s residential real estate market continued to show strong appreciation in the second quarter of 2016, posting the highest national year-over-year gain seen in five years, according to the Royal LePage House Price Survey[1] and Market Survey Forecast released today.  Amid continued world economic uncertainty, the historically low interest rate environment that has fueled Canada’s real estate market growth in recent years – most notably in Greater Vancouver and the Greater Toronto Area (GTA) – is expected to continue longer than anticipated.  This extended period of low-cost borrowing will in turn further delay the cyclical cooling of Canada’s hottest real estate markets, originally forecasted for the second half of 2016.

The Royal LePage National House Price Composite, compiled from proprietary property data in 53 of the nation’s largest real estate markets, shows that the price[2]of a home in Canada increased 9.2 per cent year-over-year to $520,223 in the second quarter of 2016.  During the same period, the price of a two-storey home rose 10.7 per cent year-over-year to $619,671, the price of a bungalow increased 7.9 per cent to $437,121, and the price of a condominium increased 4.2 per cent to $348,189.  Looking ahead to the remainder of 2016, Royal LePage forecasts that the aggregate price of a home in Canada will increase 12.4 per cent when compared to year end 2015.

“Our forecasting models, which pointed to a slowing housing market as the year progressed, included a modest increase in the cost of borrowing,” said Phil Soper, president and chief executive officer, Royal LePage. “Economic and social disruptions have rocked the world once again, introducing new risks and making it very likely that the Bank of Canada will leave interest rates as-is for now. Few industries are as rate sensitive as real estate. We don’t  see even a mild correction for either the Toronto or pistol-hot Vancouver markets in 2016.”

“Our call for 12.4 per cent national price appreciation in the final quarter of this calendar year as compared to the final quarter of last year, is a landmark in Canada.  I believe it is the highest value put forward by any serious forecasting agency since the turn of the century,” added Soper.

On June 23, 2016, Britons voted to leave the European Union, surprising financial markets worldwide.  The British currency plummeted and the value of equities around the world swung wildly. Adding to economic uncertainty is an uncharted road ahead for decoupling the U.K. from the E.U., a process which some have predicted could take two years. This added dimension of uncertainty will encourage central bankers in Canada and abroad to keep rates lower for longer.

“Some have suggested that Britain’s exit from the E.U. will drive more foreign money into the relative safety of Canada’s real estate markets,” said Soper.  “We anticipate the impact, if any, will be seen in the commercial property sector and not in housing markets. Beyond Europe, our research does point to increasing Vancouver and Toronto region foreign buyer[3] activity in residential markets this quarter. Canada remains a favoured nation for the world’s real estate investors.”

According to a survey[4] of Royal LePage real estate advisors working within these regions, 71 and 74 per cent said that year-over-year home purchases by international buyers have increased in the second quarter in the GTA and Greater Vancouver, respectively. Still, 35 and 37 per cent of respondents believe that foreign ownership accounts for less than 10 per cent of the GTA and Greater Vancouver housing markets, respectively.

“At Royal LePage, we see residential real estate as a long-term investment supporting family life. A home is ill-suited as a buy-and-flip investment.  People that engage in this kind of activity are inevitably burned when a market slows and the time it takes to sell the property increases substantially. We applaud the efforts of all levels of government to better understand Canada’s housing market, through a coordinated effort to gather and analyze real estate data. Still, we remain convinced that heavy-handed use of tax policy in an effort to artificially influence asset values in an open-market economy like ours is fraught with peril, particularly in a cyclical industry like housing,” concluded Soper.

Provincial and City Summaries & Trends

Since the 2014 collapse of oil prices and the subsequent drop in the value of the Canadian dollar, the nation’s economy has been dominated by growth in British Columbia, Ontario, Manitoba and Quebec – the four provinces most tied to the finished goods and services export sector, and by extension, to the health of the U.S. economy. The negative impact of the downturn in the resource sector, in contrast, remains concentrated in Alberta, Saskatchewan, New Brunswick and Newfoundland and Labrador.  Across the country, provincial economic trends can be seen influencing residential real estate market performance in most cities.

British Columbia’s economy has outperformed the balance of the country for two years running and is expected to continue doing so into 2017. This economic strength is echoed in the province’s housing market.  In the second quarter, Greater Vancouver posted an aggregate year-over-year home price increase of 24.6 per cent to a median price of $1,098,599.  During the same period, the city of Vancouver posted a year-over-year gain of 27.5 per cent to $1,330,531, while surrounding areas such as West Vancouver and Richmond posted even higher increases of 29.7 per cent and 28.3 per cent to median prices of $3,093,776 and $972,443, respectively.

Manitoba has been cited as one of the provinces that will outpace the national economy in 2016 and 2017[5]. This is attributed mainly to its strength in a diverse set of industries such as agriculture, health sciences, transportation, manufacturing and business services, rounding off the edges of some of the would-be effects of the commodities downturn.  In Winnipeg, the aggregate price of a home increased by a moderate 2.0 per cent in the second quarter to a median price of $285,358, with the detached two-storey home category posting the highest year-over-year price gain of 3.7 per cent to $314,589.

Ontario is expected to be one of the fastest growing provinces in 2016, with employment growth running at twice the national average so far this year. Very strong U.S. employment growth in June should once again stimulate Ontario’s export sector, after a tepid performance in the second quarter, as more American businesses look to Canada for affordable goods and services.  The GTA, the province’s largest market, saw notable year-over-year home price appreciation of 10.2 per cent to a median price of $656,365, while home price appreciation in the city of Toronto remained in-line with recent quarters, rising 8.4 per cent to $680,096.  Surrounding suburbs such as Richmond Hill, Whitby and Oshawa continued to outpace home price appreciation in the core, posting year-over-year aggregate home price gains of 21.3 per cent, 17.1 per cent and 16.7 per cent, to $992,632, $547,304 and $409,452, respectively.  Meanwhile, in the nation’s capital home prices remained steady in the second quarter, with the aggregate price of a home in Ottawa increasing 2.3 per cent to a median price of $401,288.

Strength in exports to the U.S. is expected to continue to support provincial growth in the remainder of the year in Quebec. Last month Fitch Ratings revised its outlook for the province from “negative” to “stable”, citing Quebec’s diverse economy as a key strength.  An increase in full-time jobs and renewed stability and confidence in Quebec’s economy is being reflected in the province’s residential housing sector, particularly in the Montreal region.  In the second quarter, the aggregate price of a home in the Greater Montreal Area increased by a healthy 3.5 per cent year-over-year to $344,620, while the aggregate price of a home in Montreal Centre rose 4.9 per cent to a median price of $416,953. This is indicative of a transition in the region, which is currently seeing a trend toward a seller’s market in the two-storey home segment, and a balanced market for other property types.

The Conference Board of Canada has projected that Alberta’s economy will dip 2.0 per cent this year as a result of the sharp pullback in drilling and capital investment in the energy sector, along with the impact of the Fort McMurray fires. Despite economic setbacks, residential real estate prices in the region have not seen the depreciation many onlookers had expected.  In the second quarter, the aggregate price of a home in Calgary decreased 1.8 per cent year-over-year to $454,790, while the aggregate home price in Edmonton dipped 1.2 per cent to $377,337.

Like Alberta, Saskatchewan is being hit by weakness in the energy sector, with more than 9,000 residents having dropped out of the workforce altogether. As a result, home prices in the province’s major centres have posted slight declines.  According to the Royal LePage National House Price Composite, the aggregate price of a home in Saskatoon slipped 0.2 per cent year-over-year to $370,125, while the aggregate home price in Regina decreased slightly, falling 1.7 per cent to $323,612.

Atlantic Canada saw mixed results in the second quarter, with Fredericton posting the highest year-over-year aggregate home price appreciation at 3.8 per cent to $235,425, with Moncton close behind, rising 3.0 per cent to $193,154.  Despite a rosier economic prognosis than its Atlantic neighbours, Halifax home prices remained flat year-over-year in the second quarter at $298,753. St. John’s was the only Atlantic city in the Composite to report an aggregate price decline, with the price of a home decreasing 1.5 per cent year-over-year to $336,131 amid a regional economic downturn brought on by the fall in oil prices. Meanwhile, powered by agriculture and tourism, Prince Edward Island’s economy is expected to grow slightly quicker than the national average according to most forecasters, although the residential real estate market has remained relatively flat, with the aggregate home price in Charlottetown rising 0.7 per cent year-over-year to $223,087 in the second quarter.

“Canada is not one homogeneous housing market, but rather a mosaic of many different real estate stories,” stated Soper. “While low interest rates remain the primary driver of Canada’s sustained real estate market expansion, home price trends are increasingly influenced by local factors, from the lift provided by wealthy immigrants to the drag felt by the depressed energy sector,” explained Soper. “The two regions that have provided pleasant surprises have been the oil-impacted regions where home values have been remarkably resilient.  And in Quebec, where the broad-based recovery story continues, with Montreal homes experiencing healthy price increases for another consecutive quarter.”

“Southern Ontario continues to see substantial year-over-year home price appreciation, with robust sales activity and price growth in both Toronto proper and in the region’s other urban centres, with no immediate sign of slowing down,” said Soper. “It is completely fair to describe the price increases we have experienced in the Toronto market as healthy; Vancouver is a different story altogether.  Canada’s most expensive market is distancing itself from the rest of the country at such a rapid rate that housing affordability has become a major public policy issue.”

“The quest for affordability in Vancouver seems to be influencing consumer housing type choices,” continued Soper.  “Alongside skyrocketing prices of single-family homes, we have seen an uptick in the rate of price appreciation for condominiums over 1,000 square feet, when compared to smaller units in this market.  This may indicate that families being priced out of the single-family detached home market in Vancouver are looking upwards to condominiums. In the GTA, this trend has not yet taken hold, suggesting that buyers are still predominantly moving ‘out’ to surrounding regions, versus ‘up’, in search of relatively affordable housing options,” concluded  Soper.

Aggregated regions and the Royal LePage National House Price Composite (.PDF)

Canadian Housing Trends 2016 Market Survey Forecast (.PDF)

About the Royal LePage House Price Survey

The Royal LePage House Price Survey provides information on the three most common types of housing in Canada, in 53 of the nation’s largest real estate markets. Housing values in the House Price Survey are based on the Royal LePage National House Price Composite, produced quarterly through the use of company data in addition to data and analytics from its sister company, Brookfield RPS, the trusted source for residential real estate intelligence and analytics in Canada.  Commentary on housing and forecast values are provided by Royal LePage residential real estate experts, based on their opinions and market knowledge.

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 over 16,500 real estate professionals in more than 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 symbol TSX:BRE.

For more information visit: www.royallepage.ca.

Quintessentially Canadian Cottage-Life: Royal LePage finds foreign buyers account for few recreational property transactions

Retirement-bound boomers seek peaceful retreats

Toronto, ON, June 23, 2016 – Generation X buyers of cottages, cabins and chalets across Canada outnumber Baby Boomers by almost two to one, according to the Royal LePage 2016 Canadian Recreational Housing Report released today. Still, planning for retirement living is among the most common reasons potential buyers give for the purchase of a recreational property.  The annual report compiles information from a cross-Canada survey of real estate advisors who specialize in recreational property sales.

The survey found that 65 per cent of advisors polled indicated that potential purchasers were considering their retirement needs in deciding to buy a recreational property, while a significant number of respondents (88 per cent) said that potential purchasers identified desired lifestyle and vacationing as their main purpose. Just under half of respondents (49 per cent) said that clients wanted a recreational property as an investment and a little over a third (37 per cent) indicated that low interest rates were a deciding factor.

The family status of the typical recreational property buyer is a couple with children, according to 76 per cent of survey respondents. When asked about the most prevalent age range of current buyers, 63 per cent of respondents identified Gen Xers (36 to 51 years old), almost double the 33 per cent who identified Baby Boomers (52 to 70 years old).

“We found it interesting that a majority of respondents identified retirement as a driving factor for a recreational property purchase consideration, but Gen Xers, still decades from retirement, were identified as the typical buyer in the current market,” said Phil Soper, president and chief executive officer, Royal LePage. “This cohort, having reached a place of stability, and often owners of primary residences in the country’s city centres, is making recreational property purchases for family enjoyment in the near-term and as a key strategy for retirement.”

“Canada’s extended low interest rate environment has clearly provided buyers with the confidence they need to invest in a cottage or cabin,” added Soper. “In contrast to urban home purchase decisions, buying a property on a lakefront or mountainside is much less about interest rates, and more about enhancing lifestyle. Cash savings trump mortgage financing when it comes to how people are acquiring recreational property.”

Foreign purchases – A relatively small proportion of transactions

Almost 95 per cent of respondents stated that foreign buyers[1] were responsible for 10 per cent or less of recreational property transactions. When asked to identify where foreign buyer activity originates from, the most common answer was North America (79 per cent), with the majority (64 per cent) of those who specified a country of origin stating purchasers were Americans.

Respondents were split on factors driving international  interest between the quality of living in Canada (30 per cent), geography (27 per cent) and the low Canadian dollar (27 per cent).

“We Canadians enjoy a wonderful recreational real estate reciprocity with our American cousins. Like flocks of happy geese, we fly south in the winter, and in return, Americans head to the beautiful north country when summer arrives. Canadians have been, for years, the principal foreign buyers of sunbelt property in states like Florida and Arizona, while a lower Canadian dollar has encouraged a new wave of U.S. buyers here,” said Soper.  “Whether recreational property buyers live in Canada or come from abroad, the beauty of this country, from coast-to-coast, is the appeal for families looking to ‘get away’ and enjoy the cottage experience, one that is quintessentially Canadian.”

Regional trends – Sales volumes increased year-over-year in majority of Canada’s recreational property markets

While common elements impacting the country’s regional recreational property market can be identified, variability in provincial economies and inter-provincial migration has resulted in disparate local conditions. Depressed oil prices may have dampened the recreational property activity in energy-dependent regions, and caused workers who moved for energy jobs to return to their home provinces. These provinces have seen a general uptick in demand for real estate, as the older, repatriated workers look to spend their savings on leisure properties.

Across the country, roughly two-thirds  (67 per cent) of those polled said they have seen increases in sales over the past 12 months, and over half (53 per cent) expect sales activity in 2016 to exceed 2015 levels.

British Columbia saw year-over-year[2] price appreciation, and Royal LePage expects sales activity to increase throughout the remainder of the year. Advisors cited demand from retirees as a major factor driving the market.

In Alberta,  sentiments were somewhat mixed, with advisors generally expecting continued softness in both price and sales activity in the coming year.

In neighbouring Saskatchewan, recreational property prices were up slightly compared to last year, with inventory and demand levels remaining stable.

Meanwhile in Manitoba, the recreational property market is recording slight softness, with inventory levels outpacing demand.

In Ontario slight increases over last year were reported in both price and sales volumes  across the recreational property communities studied, with inventory levels slightly down in most markets.  Looking ahead, Ontario’s recreational property markets are expected to be active for the remainder of 2016.

Similarly in Quebec, most reported that recreational property prices and activity levels have been showing slight increases this year over last, with sales volumes projected to remain healthy for the remainder of the year.

Atlantic Canada recorded that regional market conditions were mixed. Advisors in Nova Scotia reported slight year-over-year price and sales activity increases, while recreational property markets in New Brunswick remained stable on both fronts. In contrast, Newfoundland’s recreational property market reported slight decreases in prices and sales when compared to the same period last year. In light of the negative economic impacts of the oil industry’s downturn, this softness is expected to continue for the remainder of 2016, as buyers and sellers wait on the sidelines amid market uncertainty. 

Average regional prices

The chart below provides average 2016 prices across Canada for six recreational property types studied in the report including lakefront, riverfront, oceanfront, island, woods cottage/cabin, and resort/condo.

View the Chart

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 over 16,000 real estate professionals in more than 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 symbol TSX:BRE.

Home buyers remain active across Metro Vancouver

Metro Vancouver homes continue to sell at an unprecedented rate in communities across the region.

Residential property sales on the region's Multiple Listing Service® (MLS®) totalled 4,769 in May 2016, an increase of 17.6 per cent from the 4,056 sales recorded in May 2015 and a decrease of 0.3 per cent compared to April 2016 when 4,781 homes sold.

Last month’s sales were 35.3 per cent above the 10-year sales average for the month and rank as the highest sales total on record for May.

"Home sellers are becoming more active in recent months, although that activity is being outpaced by home buyer demand today," Dan Morrison, REBGV president said.

New listings for detached, attached and apartment properties in Metro Vancouver totalled 6,289 in May 2016. This represents an increase of 11.5 per cent compared to the 5,641 units listed in May 2015 and a 2.6 per cent increase compared to April 2016 when 6,127 properties were listed.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 7,726, a 37.3 per cent decline compared to May 2015 (12,336) and a 2.3 per cent increase compared to April 2016 (7,550).

"Economic and job growth in Metro Vancouver is out performing most regions in the country. This is helping to underpin today’s activity," Morrison said.

The sales-to-active listings ratio for May 2016 is 61.7 per cent. This is indicative of a seller’s market.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark, while home prices often experience upward pressure when it reaches the 20 to 22 per cent range in a particular community for a sustained period of time.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $889,100. This represents a 29.7 per cent increase compared to May 2015.

Sales of detached properties in May 2016 reached 1,865, an increase of 8.2 per cent from the 1,723 detached sales recorded in May 2015. The benchmark price for detached properties increased 36.9 per cent from May 2015 to $1,513,800.

Sales of apartment properties reached 2,150 in May 2016, an increase of 34.4 per cent compared to the 1,600 sales in May 2015. The benchmark price of an apartment property increased 22.3 per cent from May 2015 to $485,000.

Attached property sales in May 2016 totalled 754, an increase of 2.9 per cent compared to the 733 sales in May 2015. The benchmark price of an attached unit increased 24.9 per cent from May 2015 to $632,400.

Information from the Greater Vancouver Real Estate Board

Home sales remain at record levels across Metro Vancouver

Last month was the highest selling April on record for Metro Vancouver.*

Residential property sales in the region totalled 4,781 in April 2016, an increase of 14.4 per cent from the 4,179 sales recorded in April 2015 and a decrease of 7.6 per cent compared to March 2016 when 5,173 homes sold.

April sales were 41.7 per cent above the 10-year sales average for the month.

“Home buyer competition remains intense across the region,” Dan Morrison, REBGV president said. “Whether you’re a home buyer or seller, it’s important to work with your local Realtor to get the information you need and to develop a strategy that will help you navigate today’s market.”

New listings for detached, attached and apartment properties in Metro Vancouver totalled 6,127 in April 2016. This represents an increase of 3.9 per cent compared to the 5,897 units listed in April 2015 and a 2.4 per cent decline compared to March 2016 when 6,278 properties were listed.

"While we’re seeing more homes listed for sale in recent months, supply is still chasing this unprecedented surge of demand in our marketplace," Morrison said.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 7,550, a 39.3 per cent decline compared to April 2015 (12,436) and a 2.6 per cent increase compared to March 2016 (7,358).

The sales-to-active listings ratio for April 2016 is 63.3 per cent. This is indicative of a seller’s market.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark, while home prices often experience upward pressure when it reaches the 20 to 22 per cent range in a particular community for a sustained period of time.

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $844,800. This represents a 25.3 per cent increase compared to April 2015.

Sales of detached properties in April 2016 reached 1,979, an increase of 9 per cent from the 1,815 detached sales recorded in April 2015. The benchmark price for detached properties increased 30.1 per cent from April 2015 to $1,403,200.

Sales of apartment properties reached 2,107 in April 2016, an increase of 33.4 per cent compared to the 1,579 sales in April 2015.The benchmark price of an apartment property increased 20.6 per cent from April 2015 to $475,000.

Attached property sales in April 2016 totalled 695, a decrease of 11.5 per cent compared to the 785 sales in April 2015. The benchmark price of an attached unit increased 22.1 per cent from April 2015 to $608,600.

Redistribution of Canada’s Workforce Drives Further Price Appreciation in Greater Vancouver & the Greater Toronto Area

Greater Montreal Area sees signs of a real estate market revival in the first quarter of 2016 

According to the Royal LePage House Price Survey released April 7th, 2016, Canada’s residential real estate market showed strong year-over-year price increases in the first quarter of 2016.  The Greater Vancouver and Greater Toronto Area (GTA) real estate markets continue to lead the country in home price appreciation, with Canada’s economic landscape supporting robust housing demand in these metropolitan areas.  Additionally, an emerging trend of inter-provincial migration to British Columbia and Ontario from commodity-focused economic regions such as Alberta is expected to put further upward pressure on home prices in these areas in the coming months.  Meanwhile in Quebec, the residential real estate market in the Greater Montreal Area is showing the most promising signs of renewal seen in recent years, posting home price increases and a noticeable surge in unit sales in the first quarter.

The Royal LePage National House Price Composite, compiled from proprietary property value data in 53 of the nation’s largest real estate markets, showed that the price of a home in Canada increased 7.9 per cent year-over-year to $512,621 in the first quarter of 2016.  The price of a two-storey home rose 9.2 per cent year-over-year to $629,177, and the price of a bungalow increased 6.8 per cent to $426,216.  During the same period, the price of a condominium increased 4.0 per cent to $344,491.

“A glance at our national house price composite points to a very strong Canadian real estate market, yet the findings contain extreme regional disparities of the kind we haven’t seen in over a decade,” said Phil Soper, president and CEO, Royal LePage. “Like an economic triumvirate, the impact of rock-bottom interest rates, the low Canadian dollar and a rapidly expanding U.S. workforce are stimulating economic growth and housing demand in our largest metropolitan areas. Conversely in cities like Calgary, the ongoing drags in depressed energy prices and worrisome employment trends have taken a material bite out of sales volumes. As a lagging indicator, home prices in Alberta and Newfoundland are just beginning to adjust to the lower demand.”

In Alberta, year-over-year home price declines have trailed the drops in sales volumes that began in 2015, but are now starting to emerge in varying degrees across the province. Calgary, with its large population of oil company head-office professionals and less affordable housing, is expected to see more of a price adjustment during the year than will be seen in Edmonton, where prices remain relatively flat. In contrast, the GTA and Greater Vancouver markets are skewed in favour of the seller, with a shortage of inventory and growing demand putting upward pressure on prices.

“Redistribution of labour across the country is further reinforcing disparities among housing markets, as the broader impacts of the oil recession on Alberta’s economy take hold.  For the first time in many years, we are witnessing an out-migration trend in the province, as economic conditions and employment prospects dim,” continued Soper. “We expect British Columbia, followed by Ontario, to be the top recipients of new household inflows in the coming year, which will further fuel housing demand and price appreciation in Greater Vancouver and the GTA.  This is in sharp contrast to the situation from 2011 to 2014, and in the mid 2000’s, when a booming energy sector attracted families from all over Canada to Alberta.”

The Royal LePage survey also showed a noticeable divergence between Canada’s two hottest markets: while the GTA sustained its trajectory of an aggregate year-over-year home price increase in the 8 per cent range (8.4 per cent), the Greater Vancouver market accelerated at rarely seen appreciation levels, surpassing a 20 per cent (21.6 per cent) aggregate year-over-year home price increase for the region.

During the first quarter, the Greater Montreal Area real estate market saw signs of renewal, including a dramatic increase in home sales activity, which rose 9.4 per cent year-over-year. In the luxury segment, when looking at condominiums in the $500,000 to $1-million range on the island of Montreal, the year-over-year increase in sales volume jumped to 23 per cent for the quarter and for homes over $1-million, sales volume increased 14 per cent year-over-year. With adequate supply to meet this increased demand, home prices showed moderate growth, posting a 1.8 per cent year-over-year aggregate price increase in the region.

“Following a multi-year period of stalled economic and residential real estate market growth, the Greater Montreal Area is seeing a frankly wonderful upswing in demand and unit sales, which often foreshadows stronger home price appreciation,” said Soper. “While Quebec has been slower to reap the economic benefits of more affordable energy costs in addition to the big three factors driving markets elsewhere in Canada – low interest rates, a lower dollar and expanding U.S. economy – the region is turning a corner.  My vote goes to Montreal as the city most likely to exceed expectations in 2016.”

In addition to low interest rates, the low dollar, and an expanding U.S. economy, in the coming year, Montreal’s housing market is expected to gain traction as a result of strong export performance driven by a steady recovery in the manufacturing and services sectors.  Large infrastructure projects such as work on the Champlain Bridge and on the Turcot Interchange are also expected to contribute to local employment, with the Conference Board of Canada projecting that these two projects alone will reverse three years of decline in Montreal’s construction sector.

“The mood is shifting in Quebec amid a renewed era of political stability and economic promise,” added Soper. “This year we expect to see improved business and consumer confidence in the province, which will result in stronger demand for larger purchases such as houses. Home buyers are well positioned as housing is much more affordable than in other large business centres such as Vancouver and Toronto.”

Outside of British Columbia and Ontario, year-over-year changes in house prices were generally modest in the first quarter.  In Atlantic Canada, Moncton saw the largest gains, posting an aggregate home price increase of 3.4 per cent, while the remainder of the Atlantic regions surveyed saw slight to moderate declines. In other parts of Western Canada, Winnipeg home prices increased 3.8 per cent year-over-year, while Regina and Saskatoon, feeling some of the impact of declines in commodity prices and net-migration, saw slight decreases of 1.1 per cent and 0.3 per cent, respectively.

“The economic miracle that is contemporary Canada is driven in significant measure by our success at attracting quality immigrants to our land. While this is not new news, the possibility of a Donald Trump presidency has put renewed global focus on the often stark differences in opportunity and attitude that exist on either side of our huge border. In what started as a media prank, Canada’s attractiveness as a more realistic place to pursue life, liberty and happiness is gaining traction even in America. While we may just be a curiosity for many in the United States, the Cape Breton advertising campaign urging Americans to move north, as well as the record number of Americans googling ‘how to move to Canada’ reinforces the worldwide strength of brand-Canada as a prosperous and tolerant place to raise a family,” concluded Soper.

Home prices in Greater Vancouver continued to see significant appreciation during the first quarter of 2016, with the aggregate price of a home rising 21.6 per cent year-over-year to $1,044,750. The median price for bungalows in Greater Vancouver surged 25.7 per cent year-over-year to $1,116,136, while two-storey homes climbed 23.6 per cent to $1,418,231. Condominiums also saw notable growth during the quarter, increasing 9.5 per cent to $487,300.

Spring is often the time for out with the old and in with the new. So it must be "garage sale time." Whether you are planning to move or just want to clean up or de-clutter, Spring is often the time homeowners start planning a yard or garage sale. Below are some tips to get you started.

Planning a Garage Sale

Rather than discarding what you many no longer need or want, try selling it at a garage sale. A garage sale can be a profitable and fun way to make sure items are reused.

The following are some tried and true tips for a successful sale:
1. Pick the date
Make sure that the date will not conflict with holidays or special events that compete for attendance. Weekends are more successful than weekdays.

2. Bigger is better
Check with friends, relatives and neighbours to see if they would like to join you or if they have anything for you to sell on their behalf. More people mean less work and more items means more shoppers. Sharing on advertising costs increases your profit margin, too.

3. Get good sellers
Appliances, furniture, toys, tool, dishes and other such practical household items are popular. Records are also a good seller. Clothing does not usually have a high resale value, although kids clothing is the exception. Arrange kids clothing by size, and label each item. Clean everything. Make sure your items are working. If not, label them as such. For specialty items, include important information on labels. If you have items that you do not think will sell, have a “free box”. You’d be surprised what people will take and find uses for. If you have a truck, consider offering free delivery for big items within a certain distance – Customer service sells.

4. Promote your sale
If you have a community paper that is delivered to every household in your area, advertise in the classified section. Otherwise, advertise in the newspaper read most often by people in your area. Include the date, time (start early as most sales end by 1 or 2 p.m.), address and list some of the more desirable and unique items. If you don’t want early birds, include that in your ad but expect them anyway. If you are hosting the sale with others, split the advertising cost and remember to advertise the number of households participating in the sale.

5. Signage is key
Make sure the signs you make are large, clear and if possible, waterproof. Use well made, creative signs because they will attract more buyers. Some newspapers provide garage sale kits if you advertise with them, which usually includes a few signs. You should have enough signs to place at the intersection closest to your house, in front of your house and on the main streets near your house. Always include the date, time, and address on the signs.
Make signs for goods displayed at your sale. For example, “House wares”, “Kids Clothes”, etc. Make a sign that reads “Reduced Prices”. You can post this halfway through your sale.

6. Rainy day plan
Have a contingency plan for wet weather. Consider putting up tarps or holding your sale under cover.

7. Set fair prices
If you are not sure how to price your items, visit a local thrift store or garage sales. Don’t price your items too low initially, because people will bargain with you.
Put prices on everything using masking tape or removable stickers. This saves you from inventing prices on the spot and eliminates the need for everyone to ask you for prices. If many people are selling their goods, use different coloured tags (or different coloured dots on masking tape) and record sales by colour so you can correctly divide the money at the end of the day. Have lots of change and small bills on hand.

8. Make it social
Invite friends or neighbours the night before for a preview sale. If you have a street sale with your neighbours, have a BBQ afterward. At your sale, sell donuts and coffee. This will encourage people to stay longer, socialize and have a better opportunity to look at your wares.

9. It’s sale day
Expect early birds. Clear all paths and move any cars out of the driveway. Set up some tables the night before and carry them out first thing in the morning. Display your goods in an attractive way on tables, boxes or even the front lawn. For example, reuse coloured cardboard to display jewellery, and then attach the cardboard to a bulletin board. Group similar items together. If you are selling clothes, place them on hangers to display on the fence or a coat rack. Have an electrical outlet or extension cord accessible if you are selling electronic items. This enables potential buyer to test the items before they buy. Cover any items you do not want to sell with old sheets or move them out of sight. This helps prevent potential theft and stops people from trying to buy your lawnmower or garden tools.

Offer laundry hampers as shopping baskets. This allows shoppers the luxury of browsing without dropping their armful of goodies. Have extra shopping bags and boxes available for shoppers who purchase numerous items. Keep the money with you at all times. Use an apron with pockets or have one person dedicated to handling the cash. Remember to lock your house.
Be flexible and accept reasonable offers. Consider throwing in related token items, and post the “Reduced Prices” sign at lunchtime.

10. Clean up time
At the end of your sale, take down all signs and posters. If you have useful items remaining, donate them to charity or try selling them at a local flea market.