–         Lag in seasonal sales cycle brought on by the recession, coupled with undersupply, creates illusion that market is booming –

TORONTO, October 8, 2009 – Canada’s housing market is on the road to recovery but is experiencing a pronounced undersupply of homes for sale in southern Ontario and other regions of the country, according to the Royal LePage House Price Survey. With the recession retreating, the report found that home prices are stabilizing and unit sales are increasingly driven by improved affordability. 

The market’s strong showing in the third quarter has led some commentators to refer to the current conditions as the beginning of a real estate boom.  Royal LePage cautions that the increase in sales activity and firming of house prices are the product of a normal market correction and not the beginning of another aggressive expansionary cycle.

“The 2009 real estate market has seen sales activity lagging approximately one month behind the typical seasonal patterns,” said Phil Soper, president and chief executive, Royal LePage Real Estate Services. “The economic recession halted the flow of the real estate cycle from the fourth quarter of 2008 through the first quarter of 2009, but it is essentially now back on track albeit delayed. Once housing supply returns to normal levels, we believe the economy will support modest pricing growth into 2010.”

While the Atlantic provinces saw a strong recovery in home prices with double-digit percentage increases year-over-year in some markets in the third quarter of 2009, western provinces have been slower to recover from the significant price corrections that occurred in 2008, particularly in British Columbia and Alberta. Meanwhile, Ontario and Quebec saw home prices stabilize or gain slightly year-over-year with much of the recovery occurring throughout the strong third quarter.

Royal LePage’s third quarter report shows that the average price of a two storey home in Canada was comparable to a year ago (up 0.1 per cent) at $409,335. Average bungalow values increased 0.06 per cent year-over-year to $341,146, while the price of an average condominium increased 0.09 per cent to $243,748.

 After the economic crisis created a drought of home sales and declining prices from the fourth quarter of 2008 through the first quarter of 2009, the market began to recover in the spring due to pent up demand and improved affordability. “It appears the market recovered unevenly,” Soper commented. “In the first quarter of 2009 we saw the return of first time buyers, then cautious move-up buyers. In the third quarter, the sales activity of the higher priced regions of the country and higher priced property types picked up momentum and caught up to the lower priced segments.”

A shortage in housing supply is leading to bidding wars in several cities, including Toronto, Richmond Hill, Markham, Montreal, St. John’s (NF), St. John (NB), Moncton, Edmonton, Calgary, North and West Vancouver, and Victoria. Improved affordability is the biggest driver of current real estate activity levels, Soper added. “With the widespread availability of affordable mortgage financing, and only modest increases in home prices, affordability is better now than it has been in a number of years. We expect house prices and interest rates to remain relatively stable into next spring which would keep affordability levels intact.”

Regional House Price Data

Royal LePage’s latest quarterly House Price Survey shows the strongest growth in year-over-year increases in St. John’s, Newfoundland, where standard two storey homes were up 13.3 per cent over 2008, to $296,667, with bungalows and standard condominiums showing similar price gains. Most other major centres in Atlantic Canada experienced modest growth, with the exception of Saint John, New Brunswick, where detached home prices continued to fall year-over-year and quarter-over-quarter in Q3.

In Toronto and the Greater Toronto Area, the real estate market saw a distinct pause earlier this year. House prices, however, did not fall dramatically due to a reduction in the number of listings on the market. Currently, single family and semi-detached home prices are outperforming other categories. Detached bungalows are up 0.8 per cent and standard two storey homes are up 1 per cent year-over-year, while standard condominium prices fell 3 per cent over the same period. All three categories have shown price increases compared to second quarter numbers.

Diversified economies in Ottawa, Montreal and Winnipeg contributed to modest home price appreciation in those cities in the third quarter. Canada’s capital saw standard two storey homes increase 3.3 per cent year-over-year, to $327,833, while similar homes in Winnipeg increased 5 per cent to $265,938. Montreal home prices also continued to improve, with a year-over-year increase of 2.1 per cent for standard two storey homes, at $343,480, and a 4.4 per cent improvement in standard condominium prices, to $213,278.

“Markets in Quebec, eastern Ontario and Manitoba had fewer of the price spikes we saw elsewhere, the corollary being that housing markets in these regions fared better during the recession,” said Soper. “These regions have not been recession proof from a real estate perspective, but certainly have proven recession resistant, helped by balanced economies with diverse employment bases across manufacturing, resources, government, and services.”

Meanwhile, in the traditional boom-bust, resource dependent economies in western Canada, home prices that corrected sharply downwards in 2008 have been slower to recover. In almost all regional markets across the prairies and British Columbia, year-over-year home values continued to be flat or declined in Q3 2009. In Saskatchewan, home prices dropped between 0.6 per cent and 5.6 per cent with a standard two storey home in Regina averaging $251,500. Alberta values declined year-over-year between 1.6 and 9.3 per cent. Although house prices remain below last year’s levels in Calgary and Edmonton, they are starting to improve. Calgary saw two storey homes recover slightly to $414,556 while the average price for a two storey home in Edmonton remained flat at $327,429 from last quarter.

In B.C., where market activity picked up considerably in the third quarter, detached home prices in Vancouver were still down between 1.8 and 2.3 per cent year-over-year, however values improved during the third quarter with standard two storey homes selling for an average of $904,750.

 “It is a modest recovery but a recovery nonetheless and that change is reflected in the housing market,” said Soper. Although key economic indicators are showing signs of improvement, fears over job security and economic instability will keep many Canadians in their current homes. “Fewer people are willing to move, because they’re still concerned about the economy. Until they are convinced things are back to normal, some people will not put their homes up for sale and we’ll continue to have constrained supply.”

 The Royal LePage House Price Survey is the largest, most comprehensive study of its kind in Canada, with information on seven types of housing in over 250 neighbourhoods from coast-to-coast.  This release references an abbreviated version of the survey, which highlights house price trends for the three most common types of housing in Canada in 80 communities across the country.  A complete database of past and present surveys is available on the Royal LePage Web site at www.royallepage.ca, and current figures will be updated following the end of the quarter.  A printable version of the third quarter 2009 survey will be available online on November 6^th, 2009.

Housing values in the Royal LePage Survey are Royal LePage opinions of fair market value in each location, based on local data and market knowledge provided by Royal LePage residential real estate experts.  Historical data is available for some areas back to the early 1970s.

September 2009 (Updated Monthly)

Town of New Tecumseth

Town of Bradford, West Gwillimbury

King Township

*Avg. Days on Market is based on homes sold during current month

 Every one received a property tax assessment in 2008 explaining the changes that were taking place and how the property tax was calculated on your home.  It is important not to throw that tax assessment away as you will not receive a new one for four years (2012).

 At the bottom of your property assessment you’ll see a user ID and password.  This gives you access to two powerful tools available to you through MPAC,  AboutMyPropertry and PropertyLine.

AboutMyProperty™ is a secure, online self-service application that provides property owners with convenient access to property assessment information. Through this service, you can access property assessment information, site information, lot size and recent sales information on your property and similar neighbourhood properties of interest – free of charge.

propertyline™ enables you to purchase Assessment, Site, Structural, and Sales data on all types of properties across Ontario. Information is refreshed from MPAC’s database weekly to ensure users have access to the most current property information in Ontario.

To access MPAC via the web – go to www.mpac.ca and to access via telephone call 1-866-296-6722.

Living and working to support a wonderful community,

Glynnis De Jong

TORONTO, September 10, 2009 – The Royal LePage Real Estate Advisor Survey of more than 1,100 Royal LePage agents and brokers across Canada shows that 61 per cent believe the housing market’s current strength is sustainable. Canada’s resale housing market witnessed record-setting resale volumes in July prompting the Canadian Real Estate Association (CREA) to revise its housing forecast for the rest of 2009.

Affordable mortgage financing stood out as a factor driving the market as more than 64 per cent cited the low interest rate environment as the most important single factor attracting home buyers.  For the Royal LePage brokers and agents who do not believe the current strength of the market is sustainable, an expectation that interest rates will rise was cited as their number one reason (36 per cent).  

“The Governor of the Bank of Canada made an early year commitment to Canadians that the central bank would stand by its low interest rate policy into 2010. This principled stance has been received very positively by prospective homeowners who have felt confident in making the substantial investment that home ownership represents. Together with numerous positive economic indicators seen over the course of the summer, we believe that the current health of the real estate market is sustainable,” said Phil Soper, Chief Executive, Royal LePage Real Estate Services Ltd.

Results

Do you think the housing market’s recent performance is sustainable? (1,153 responses in total)Yes: 707 responses (61 per cent)
No: 320 responses (28 per cent)
Don’t know: 126 responses (11 per cent)

If you answered No, what do you think is the primary reason? (421 responses in total)Will end when interest rates start climbing which is imminent: 152 responses (36 per cent)
We are not adding jobs in Canada, so we are not adding buying power: 86 responses (20 per cent)
The current frenzy is due to pent-up demand which will be fully met shortly: 79 responses (19 per cent)
Canadian housing market in Canada is overvalued and overpriced – can’t last: 32 responses (8 per cent)
Other: 72 responses (17 per cent)

What factors do buyers think have contributed to the housing market’s recent performance? Ranked by first choice (1,062 responses in total)Low interest rates: 701 responses (66 per cent)
Belief that the economy is strengthening: 97 responses (9 per cent)
Release of pent-up demand: 71 responses (7 per cent)
Not wanting to miss the rally in home prices: 62 responses (6 per cent)
Perception of long-term job stability: 43 responses (4 per cent)
Positive media coverage: 34 responses (3 per cent)
Government incentives: 21 responses (2 per cent)
Other: 33 responses (3 per cent)

Why are sellers choosing to sell at this time? Ranked by first choice (1,108 responses in total)Upgrading: 369 responses (33 per cent)
Downsizing: 281 responses (25 per cent)
Relocating: 163 responses (15 per cent)
Realize a return on investment: 136 responses (12 per cent)
Retiring: 71 responses (6 per cent)
Other: 88 responses (8 per cent)

About Royal LePage
Royal LePage is Canada’s leading provider of franchise services to residential real estate brokerages, with a network approaching 14,000 real estate professionals in over 600 locations across Canada.  Royal LePage is managed by Brookfield Real Estate Services, and is part of a brand family that includes Royal LePage, Johnston and Daniel, and La Capitale Real Estate Network.  An affiliated company, Brookfield Real Estate Services Fund, is a TSX listed income trust, trading under the symbol “BRE.UN.”

For more information visit www.royallepage.ca.

• you were 64 or older; and
• you owned and occupied a principal residence in Ontario, on which you or someone on your behalf, paid property tax for the year 2008. 

The maximum grant for 2009 is $250.

Outdoor Projects

• Complete exterior painting before cooler weather arrives
• Check and repair exterior lighting before daylight fades
• Store lawn ornaments and patio furniture in a shed or basement. If space is limited, weather-resistant covers can protect outdoor furnishings
• Cover air conditioner and barbecue to prevent winter damage
• Close your pool before leaves start to fall, and nighttime temperatures begin to drop. Sooner than that and you risk an algae bloom
• Store kids toys indoors or in an outdoor shed to prevent rusting and fading

Lawn & Garden  

• Till and prepare planting beds when the soil is relatively dry. By adding soil and mulch to your beds, you’ll be a step ahead for spring planting
• Plant spring blooming bulbs and perennials
• Protect roses, saplings and small trees by sheltering them with a burlap screen
• Pull weeds to reduce the number of seedlings next spring
• Mow grass short for the final cut of the year by reducing the cutting height gradually to 3.5 cm (from 7.4 cm) until the grass stops growing

Indoor Preparation

• Bring container plants indoors, making sure they are free of pests. Doing so may enable plants to survive the season and bloom again in spring
• Check and clean your humidifier. Empty the tank, dry the inside surfaces and refill with clean water. Be sure to follow the manufacturer’s instructions

According to Jay Walljasper, author of “The Great Neighborhood Book”, a great neighbourhood is about community.  It’s about knowing your neighbours, feeling safe, and having pleasant spaces to be together.

Walljasper’s book offers lots of ideas for making your neighbourhood a better place to live and for building a stronger community:

• Know thy neighbours.  Sit on your front steps and say hello as people walk by.  Have a chat with the person who pumps your gas or the retired lady down the street.  You’d be amazed at how people open up to a little friendliness.

• Create a great gathering spot.  A nice playground with benches and shaded areas is a natural place for residents to gather.  Communities across Canada have worked together to raise money via personal and corporate donations to build spaces kids and adults love.

• Make it an event.  Whether it’s a neighbourhood barbecue, a Saturday street sale, or an organized trick-or-treating event for the kids, getting your neighbours together to do something fun builds friendship and community.

• Walk more, drive less.  Get out and enjoy the neighbourhood instead of sealing yourself off in a car.  Encourage walking by lobbying the city to widen sidewalks, add crosswalks, and traffic calming zones.

• Be neighbourly.  Shovel your neighbour’s walk when they are out of town, offer an afternoon of babysitting to the single parent down the street, or welcome a new neighbour with an invitation to coffee.

• Take back the streets.  If you live in an area where crime is a problem, organize a neighbourhood watch and walk around.  If you see anything suspicious, notify the police.  Criminals are deterred when there are too many people around.

• Shop local.  Supporting your local merchants will ensure they succeed along with the distinctive flavour they add to your neighbourhood.  If you don’t have shops in your area, it may be due to zoning restrictions.  Lobby your city council to change zoning so that retailers can set up shop.

• Take pride.  Take care of your neighbourhood the way you take care of your own property.  When you go for a walk, bring a bag to pick up litter.  Plant flowers in public places.  Spruce up the park swings with some fresh paint.

• Take advantage.  Enjoy what your neighbourhood has to offer.  Hang out at the coffee shop, go for a walk or bike ride, relax in the park.  A great neighbourhood is only great if you take time to enjoy it.

It takes work to make things better, but everything you do will pay off through your enjoyment of your community – and increased property values.  For more ideas, consult “The Great Neighborhood Book” .  It’s an excellent resource that could spark some greatness is your neighbourhood.