Vancouver home prices are leading Canada, says survey

Big sale prices on homes in Vancouver’s most expensive neighbourhoods pushed the city’s average prices up steeply on realty firm Royal LePage’s third-quarter survey of Canadian home values.

Royal LePage said Wednesday the average price for a detached bungalow in Vancouver rose 17 per cent to $1.02 million in the third quarter compared with the same period a year ago, which the firm noted is nearly three times the national average of $349,974 for that type of property.

For the purposes of the survey, Royal LePage said Vancouver is defined as including Vancouver’s west side and east side, West Vancouver and North Vancouver.

A standard Vancouver two-storey home was up 16.9 per cent in the third quarter on Royal LePage’s measure to $1.142 million, but the price of a standard Vancouver condominium was up just 5.1 per cent to $513,500, which was still twice the national average for a condominium.

However, the averages mask considerable variability between markets around Metro Vancouver, according to Bill Binnie, managing agent for Royal LePage North Shore.

“One could draw the wrong conclusion if you just singled out West Vancouver, Vancouver west-side and Richmond because price increases there are far greater than in other areas,” Binnie said in an interview.

West Vancouver, Binnie added, saw the steepest increases, with average bungalows up 25 per cent to $1.2 million and standard two-storey homes up 24 per cent to $1.3 million.

Binnie said that rise represented a bit of “catch-up” with Vancouver’s west side.

“West Vancouver didn’t have the sort of price increases that the west side had last year,” Binnie added, and in 2011 the North Shore municipality saw an influx of the same buyers who have helped push prices up in Vancouver’s west-side neighbourhoods.

Binnie said judging by the number of buyers who are using their agents’ office addresses in sales contracts, he believes much of the new interest is coming from Asia.

In other areas of Metro Vancouver, however, the experience has been different, Binnie said.

In Coquitlam, for instance, Royal LePage calculated that average prices were up just 3.2 per cent and in Port Moody the increase was 7.7 per cent.

The Sunshine Coast, he added, saw prices in the third quarter slip 0.7 per cent.

Nationally, Royal LePage said home prices were up in the third quarter of 2011, but the raw numbers may be masking market weakness in certain areas.

The Royal LePage House Price Survey found that the average price of a home in Canada increased between 5.7 and 7.8 per cent in the third quarter of 2011 compared to the same period last year.

The average price of a detached bungalow was $349,974, a standard two-storey home was $388,218 and a standard condominium was $239,300, according to the survey.

Royal LePage said the increase in price defied expectations and suggested that record-low interest rates and a fairly stable Canadian economy have bolstered consumer confidence.

However, the third quarter of 2010 was a relatively weak period for housing prices, which makes the increase this year appear rosier than they are and may mask a decline in prices in the months ahead, it said.

“The strength in Canada’s national housing market conceals signs of predictable softening in some regions,” Phil Soper, president and chief executive of Royal LePage Real Estate Services, said in a statement.

Vancouver had the highest priced homes in the country during the third quarter of 2011 and was the only city in the survey where the average bungalow or two-storey home cost more than $1 million.

Halifax, Montreal, Toronto, Saint John, N.B., and Ottawa saw prices increases of between 4.4 and 10.4 per cent.

In Alberta, the volume of homes trading hands increased, but prices stayed soft, the survey found: Detached bungalows in Calgary fell one per cent in the third quarter.

Victoria was similarly weak, with detached bungalows and standard two-storey homes falling two and 1.1 per cent respectively.

Source: Derrick Penner, Vancouver Sun
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