Canadian House Prices...The Last 10 Years and in 2011

A recent Remax report states that Canadian home owners have benefitted from annual price gains of almost 7.0% over the past 10 years.  Sales data from 18 major Canadian markets found that the annually compounded rate of return was 6.82 per cent, as tight inventories helped drive home prices higher across the country.  ReMax said "the market has been skewed toward sellers for most of the last decade, except during 2008 and early 2009 when prices sagged through the recession".

Western Canada lead the way with the highest rates of return for real estate over the past decade, with values in Regina posting the greatest percentage increase (9.56 per cent), followed by Edmonton, (9.25 per cent), Saskatoon (9.2 per cent), Winnipeg (9.01 per cent), Kelowna (8.42 per cent), Greater Vancouver (7.8 per cent), Calgary (7.7 per cent) and Victoria (7.59 per cent) all outperforming the national average. Housing values in Quebec City and Montreal also rose 9.2 and 8.48 per cent respectively.

Ontario and Atlantic Canada saw more moderate increases. Ottawa led the way in terms of price appreciation in Ontario at 6.78 per cent, followed by Hamilton-Burlington at six per cent, Kitchener-Waterloo at 5.69 per cent, the Greater Toronto Area at 5.35 per cent, and London-St. Thomas at 4.82 per cent.  The highest returns in Atlantic Canada were found in Newfoundland & Labrador, where values escalated 8.14 per cent on average. 

As for what we can expect in the year ahead for house sales...The Canadian Real Estate Association has recently updated its forecast for the rest of 2011, projecting house sales to fall by only 1.6% as lower interest rates  continue to keep buyers in the market.  As recently as this past November this same group suggested that home sales in the coming year could see a drop of almost 10% from the 2010 totals.  The softening stance on the potential drop-off in home sales also includes an expected increase of 1.3% in actaul home prices.  

Domenic Mirabelli
416.303.4480
domenic.mirabelli@migroup.ca  

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