Strong residential market expected for early 2010 (January 15, 2010)
Canada’s housing sector is expected to remain “unusually strong” in the first half of the year, then trend towards a more balanced market, according to real estate broker Royal LePage. Improving economic conditions and steady low interest rates will stoke demand as 2010 gets under way, but higher home prices coupled with expectations of rising interest rates could cool the market later in the year.
“Our forecast is built upon an expectation that interest rates will ease upward before the year’s end, which should have a dampening effect on demand, allowing it to come into balance with the supply of resale homes on the market,” said Phil Soper, president and chief executive of Royal LePage Real Estate Services.
Home prices continued to rise in the fourth quarter of 2009, building on the momentum from the previous quarter. According to its house price survey, Royal LePage said the average price of a two-storey home in Canada rose 5.2 per cent to $353,026 in the fourth quarter. Nearly all of the 16 markets surveyed showed price gains in the fourth quarter, with Toronto and the Lower Mainland of British Columbia doing particularly well.