Eye-popping prices for Calgary housing
Average cost of typical 2-storey home rockets 54.6%
Toronto resales lag at 4.4% in moderating market
Jul. 6, 2006. 01:00 AM
TONY WONG
BUSINESS REPORTER
If you're suffering from sticker shock on housing-price increases in Toronto, think Calgary.
The average price of a standard two-storey resale home rocketed an unprecedented 54.6 per cent to $397,867 in the second quarter of 2006, compared with a year earlier, according to a quarterly report Royal LePage Real Estate Services released yesterday.
"Since we started doing this report in the '70s, we've never seen this kind of price appreciation in one year, ever," Phil Soper, president and chief executive of Royal LePage, said in an interview.
Alberta's oil-rich economy has meant severe housing shortages and major price increases in the western provinces.
"The Alberta housing market is truly reacting to the fact it is by far the best-performing economy in Canada," Century 21 Canada president Don Lawby said in an interview.
Edmonton was in second place with a 39 per cent increase, while Vancouver, which is looking forward to the 2010 Winter Olympics, saw a 20 per cent increase.
In the east, things were much less frenzied as real estate agents reported fewer bidding wars, and even price reductions on some listings.
"We're moving to a more transitional summer market in Toronto, so you'll see volume dropping off from a great market to a good market, and certainly nothing like Alberta," Lawby said.
House prices in Toronto increased by a solid but not spectacular 4.4 per cent in the second quarter of 2006, compared to the same time last year, as the market continued to moderate, according to the LePage report. The average price of a standard two-storey home — the most sought-after type of property — rose to $474,766.
The two-storey home in the survey also has three bedrooms, a detached garage and full basement but no recreation room and totals 1,500 square feet.
Meanwhile, a detached bungalow averaged $373,504, up 5.5 per cent. Condominiums showed the most appreciation, rising 6.7 per cent to $256,178.
"We saw the market move from a seller's market to a more balanced market at the end of the fourth quarter of last year, so buyers should be able to get a better shake," Soper said.
Royal LePage is forecasting that the average price increase for all types of property in Toronto should be in the 5.6 per cent range by the end of the year.
Century 21 is slightly more optimistic in its Toronto forecast, which predicts price increases in the 6 to 7 per cent range.
Still, both forecasts are well below the national pace forecast by Lepage, which expects increases of 9.2 per cent by the end of 2006.
However, neither real estate firm is expecting sales in the Toronto area to break last year's record.
"We can't have record-breaking sales every year. But I've been wrong before," said Lawby, noting that most analysts thought the market would have wound down in 2005, compared with the year before. Sales continued to defy expectations by going up as interest rates remained affordable and job numbers were stronger than expected.
Of the 23 Toronto neighbourhoods surveyed by LePage, Riverdale showed the highest year-over-year appreciation. A shortage of listings meant the standard two-storey home hit $350,000, up 14.8 per cent.
Richmond Hill and Markham also had strong growth, with prices for a standard two-storey up 13.3 per cent and 11.7 per cent respectively.
Meanwhile, areas such as the Beach district and Cabbagetown, which have posted stellar appreciation, took a breather. In Cabbagetown, the two-storey was up only 1.9 per cent; in the Beach, down 0.7 per cent.
