If home prices are going down, it hasn’t happened yet. According to the Royal LePage House Price Survey, home prices went up in the first quarter of this year, when compared to the same time last year, and they increased by 2.2% – 5%, depending on where you’re looking at in the country.
On a whole, the price of a two-storey home rose to $398,282, a total increase of 5%. This average of course, will vary greatly where you’re looking, as will all prices, but it’s the standard two-storey home that seems to have the biggest discrepancy when it comes to price. This type of home in Toronto could come with a Toronto mortgage somewhere in the area of $645,467, whereas mortgages in Vancouver can go as high as $1,182,250 in order to buy a standard two-storey home. The price of detached bungalows rose 4.4% to $356,306; while the prices of condominiums saw the smallest jump in prices, with a 2.2% increase that put the average condo sale up to $243,153.
Phil Soper, president and chief executive of Royal LePage Real Estate Services, spoke about the huge gap in range of prices and commented that, in some of the priciest locations anyway, there would be price resistance. “Although [Vancouver] posted a strong year-over-year price gains in the first quarter, we expect to see Vancouver’s housing market to real a level of price resistance. Although desirability is high, many potential buyers have simply been pushed out of the market and cannot take advantage of low mortgage rates, which will ease demand and should bring price relief.”
Soper also commented that while Vancouver’s unnaturally high home prices would start to decrease as consumers simply stopped paying the high prices, he doesn’t expect the same thing to happen in the Toronto market. One area of particular interest, Soper notes, is the Calgary. Calgary mortgages have maintained their position since last year, with prices remaining the same. However, this is still an area that’s booming. Even with no fluctuation in home prices, the city showed much growth in the number of homes that were actually sold, when compared with stats from 2011.
Soper ended his comments that were released with the survey by saying, “Our housing market is being pulled in opposite directions by opposing economic forces. On one hand, there is the rapidly strengthening U.S. economy, increasing Canadian consumer confidence and what can only be called a national mortgage sale encouraging activity and bidding up home prices. On the other, we have signs of over-shooting values and strained affordability in our largest cities. We are likely to see much more modest price appreciation as the year unfolds.”
