Canada's red hot real estate market continued to soar in the fourth quarter of 2007 with little sign of the traditional winter slump, according to new data released Tuesday by Royal LePage.
Many markets reported double-digit gains in the final months of last year, likely driven by booming energy sectors across the country, says the House Price Survey report.
"The fourth quarter of 2007 was surprisingly strong, with unseasonably high price increases and unwavering demand," said Phil Soper, president and chief executive of Royal LePage Real Estate Services.
Soper cites the value and export demand of Canada's natural resources as one factor for the strong market, along with high employment rates fueling confidence in job stability.
Prices for a number of housing types were on the rise in 2007:
- detached bungalows rose to 11.6 per cent to $337, 555;
- two-storey properties rose 11.3 per cent to $399, 738;
- standard condominiums increased 11.7 per cent to $240, 395.
The Prairie provinces continued to dominate in price appreciation last year with some markets, such as Regina and Saskatoon, experiencing 50 per cent gains in the fourth quarter.
Property prices appreciated the most in Saskatchewan, based mostly on the availability of affordable homes and a shortage in supply relative to increasing demand, the report states.
"The combination of a spike in the number of available jobs, the reasonable cost of living, and the attractiveness of the prairie lifestyle led to an unprecedented number of people searching for homes," the report reads.
In Winnipeg, demand also outstripped supply while Vancouver's population rate and eagerness to own property continued to soar, bolstered by the availability of jobs associated with the 2010 Winter Olympics.
In resource-rich Alberta, a surplus in inventory and strong demand for reasonably priced homes tempered demand in Calgary and Edmonton.
The province experienced more balanced conditions in the fourth quarter of 2007 due to a rapid escalation, in excess of 50 per cent in some areas, of prices in the first quarter of the year.
Toronto's new land-transfer tax prompted prospective buyers to snatch up property in the final quarter of 2007 despite some of the highest property prices in the country. The manufacturing sector, which is struggling to deal with the soaring Canadian dollar, in Quebec and Central Ontario had little effect on activity in real estate as both provinces reported steady buyer activity in the fourth quarter.
In Atlantic Canada, Saint John had the highest gains in property appreciation, landing within the top-five cities for property value increases.
"Despite a restructuring of the Irving family's business assets, discussions persist about the development of a new $7 billion refinery in the Saint John area -- a plan that would further solidify the province's reputation as the natural resource hub of eastern Canada," the report says.
Soper predicted the real estate market's "frantic pace" will cool in 2008; with average prices continuing to rise but at a more moderate pace.
"Canadian buyers and sellers can expect healthy, balanced conditions in 2008 - the best environment for a strong and sustainable real estate market," Soper said.
