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HOUSING MARKET
OUTLOOK 2010
Canadian
Overview
The worst recession since the Great Depression had First-time buyers, feeding on low interest rates, ventured
a serious impact on housing performance during into the market, taking advantage of greater afford-
the first quarter, with home sales down 27 per cent ability levels. Move-up purchasers followed in tandem,
nationally, compared to 2008 figures. Consumers trading up to larger homes and/or better neigbhourhoods.
adjusted to new market realities—including buyer’s
market conditions—as the supply of homes available By year-end, housing sales had recovered in virtually
for sale rose and values dipped. Hardest hit were all residential housing markets across the country,
markets in Greater Vancouver and Sudbury, where led by a 45 per cent increase in Greater Vancouver.
the number of homes sold declined 40 per cent; Calgary Two markets, including Ottawa and Québec City, hit
slipped 35 per cent; and Victoria, Greater Toronto, historic highs in residential sales, reporting more than
St. Catharines, Regina, Montréal, London, Kitchener- 15,500 and 14,000 units sold respectively. Last but not
Waterloo, Halifax-Dartmouth, and Hamilton-Burlington least, housing values posted new records in 15 of the 23
were off 2008 figures by more than twenty per cent. markets surveyed, including St. John’s with an upswing
of 15 per cent. Other noteworthy developments include
Yet, after one of the most difficult first quarters in shattered price benchmarks in Greater Vancouver at
Canadian housing history, the market miraculously $600,000; Toronto at $400,000; Ottawa at $300,000;
changed course. Rising like the phoenix from the ashes, and Québec City and St. John’s at $200,000. Nationally,
real estate activity across the country gained momentum. residential housing sales are expected to top 465,000
units by year-end 2009, a seven per cent increase over
CANADA one year ago; while housing values climb five per cent
Residential Unit Sales 2007 – 2010 to $318,000, up from $303,594 in 2008.
600,000
$650,000 Victoria
While the impact of the global economic recession
$625,000
was evident in Victoria’s housing market through the
Fall of 2008 and into the first quarter, the market
$600,000 bounced back with a vengeance, improving steadily
throughout 2009. Demand for resale homes is now very
strong. Conditions quickly transitioned from balanced
$575,000
back into seller’s territory, following a tightening in
inventory levels in late Spring. Listings—at over 5,000
$550,000 units earlier in 2009—are down 31 per cent from year-
2007 2008 2009* 2010**
ago levels at just 3,200 units, resurrecting the multiple-
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
offer phenomenon throughout the city’s hot pockets.
KELOWNA
2,000
Residential Average Price 2007 – 2010
500000
$450,000
1,000
$440,000
0
2008 2009* 2010**
*Estimate **Forecast $430,000
Source: CREA, Local Real Estate Boards, RE/MAX
$420,000
of whom hoped for the best but prepared for the $350,000
350000
EDMONTON
Residential Unit Sales 2007 – 2010
Calgary
25,000 While economic concerns dominated headlines through-
out much of the year, Calgary’s residential real es-
20,000 2% tate market quietly staged a comeback. As a result,
18%
overall housing sales are expected to top 26,000 units
15,000 by year-end, an increase of 12 per cent from 2008
levels. Recovery has largely been driven by first-time
10,000 buyers, many of whom had been priced out of the
market in recent years. Pent-up demand, rock-bottom
5,000 interest rates, greater affordability, and improved selec-
tion all served to entice purchasers early in the year—
0
who seized upon entry-level product priced under
2007 2008 2009* 2010**
$400,000 in established communities in the south-
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
west, northwest, south central, and north central.
The subsequent surge in activity placed upward pres-
30,000
25,000
12%
8% Saskatchewan
20,000
15,000 Regina
10,000
Regina’s residential real estate market came full circle
5,000 in 2009, with buyer’s dominating the first half of
0
the year and seller’s staking claim to the second.
2007 2008 2009* 2010**
Apprehensive purchasers waited on the sidelines
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
for much of the first quarter in anticipation of reces-
sionary fallout. When it failed to materialize, they
cautiously ventured into the market, taking full ad-
*Estimate **Forecast
Saskatchewan’s economy showed remarkable resil- Source: CREA, Local Real Estate Boards, RE/MAX
ience in 2009, despite an anticipated 1.3 per cent
decline in GDP growth. Unemployment levels re-
main the lowest in the country at approximately 4.9 over the next decade. Its prospects for oil will shore up
per cent—significantly less than the national average. the province’s economic foundation considerably, with
Saskatchewan poised to eclipse Alberta as Canada’s
Going forward, Saskatchewan is expected to lead lead supplier of conventional light crude by 2012.
the country in terms of GDP growth (at about 3.6
per cent) in 2010, outperforming the national average Unemployment is still expected to edge higher in 2010—
by almost a full percentage point. Healthy residential at 5.3 per cent—as recovery is underway. Retail sales are
real estate activity, improved weather conditions, and expected to rebound, to 5.8 per cent —helped out by
increased global demand for agricultural products recent provincial income tax cuts—surpassing every pro-
(boosting such products as potash) should strengthen vince in Canada with the exception of British Columbia.
economic performance. The mining sector is expected
to see a boost in uranium—with production set to double Net positive interprovincial migration and immi-
gration are expected to further bolster the residential
REGINA real estate market in Regina in the year ahead. As
Residential Unit Sales 2007 – 2010 consumer confidence returns to post-recession levels,
5000 home sales are forecast to edge higher, climbing five
per cent to 4,000 units by year-end 2010. Inventory
4000 is expected to improve, with more balanced market
5% conditions emerging. First-time buyers are expected
14%
3000 to once again lead the charge, with the move-up
segment following in lock-step. After several years of
2000 double-digit increases in average price, appreciation will be
more tempered, rising a healthy six per cent to $260,000.
1000
0
2007 2008 2009* 2010**
Saskatoon
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
Concerns over the global economic crisis continued
to drag down sales in Saskatoon during the first half
of the year, but as sentiment improved, sales began
to climb. High consumer confidence, a better-than-
average economy, low unemployment, affordable inter-
0
2007 2008 2009* 2010**
Manitoba
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
cent from 2008 levels, and five per cent ahead of the
previous benchmark set in 2007 (14,739). Housing
15,000 0%
values in the nation’s capital are also expected to
11%
climb, appreciating five per cent to $305,000 in
2009, up from $290,483 one year ago. Job security 10,000
and stable economic performance are the major fac-
tors influencing those considering homeownership,
a decision enhanced by rock-bottom mortgage rates. 5,000
1,000
0
2007 2008 2009* 2010**
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
5,000
4,000
3,000
2,000
1,000
0
2007 2008 2009* 2010**
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
6,000 Toronto’s successful bid for the 2015 Pan Am games will
also have a positive impact on the Hamilton area in com-
3,000
ing years, with $150 million earmarked for a new stadi-
um and four Olympic-sized pools. McMaster recently
0
unveiled its Atrium building—the first in McMaster
2007 2008 2009* 2010**
Innovation Park to open—and already more than 70
*Estimate **Forecast
Source: CREA, OMREB, RE/MAX
per cent full. The CNMET Materials Technology
Laboratory is also underway, a $60-million project
With the economic fundamentals of the area on While unemployment rates are expected to hover at
the upswing, the future bodes well for residential approximately nine per cent in 2010, job opportunities
real estate in Hamilton-Burlington. Approximately are forcast to increase. Government stimulus dollars
12,800 homes are expected to change hands in 2010, are predicted to kick into gear, with several capital
an increase of four per cent over 2008 levels. More and projects now underway, including a $739 million
more buyers are expected to venture into the market new hospital and regional cancer care centre; a $101
as consumer confidence gains precious momentum. million performing arts centre; and a $28 million
First-time buyers will continue to be an integral parking garage. Brock University has been given the
component, fuelling demand for homes priced be-
tween $250,000 and $300,000 in areas like Hamilton’s ST. CATHARINES & DISTRICT
west end and the Mountain. For those looking for Residential Unit Sales 2007 – 2010
2,000
While London-St. Thomas was hit hard by the effects
of the recent global recession, the resale housing 0
2007 2008 2009* 2010**
market remained relatively stable throughout 2009.
Sales, however, are expected to close the year four per *Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
cent below 2008 levels at 8,000 units, while average
price experiences a modest upswing of two per cent
to $215,000 from year-ago figures.
$250,000
250000
Québec
$225,000
Greater Montréal
Greater Montréal’s residential real estate market
$200,000
200000 continues to experience strong upward momentum,
despite a slower than usual start to the year. Spurred
by rock-bottom interest rates and growing consumer
$175,000
confidence levels, home sales are expected to top
43,000 by year end, a five per cent increase over the
150000
$150,000
20072008 2008 2009**
2009* 2010***
2010**
40,916 units sold in 2008. Average price is forecast
to escalate further, recording a three per cent increase
*Estimate **Forecast
Source: CREA, Sudbury Real Estate Board, RE/MAX
to $266,000 in 2009, setting a new record for the city.
begun to narrow.
$125,000
Island
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
Prince Edward Island’s residential real estate perfor- lull in the market and low interest rates to trade-up
mance can best be characterized as lacklustre in 2009, to a larger home. Out-of-province buyers and new
despite a soft economic landing for the province. immigrants have helped to offset the decline in
Approximately 1,000 homes are expected to change first-time buyers on the Island in recent months, but
hands by year-end, down 17 per cent from 2008, and their numbers are too small to make a significant
well off peak 2007 levels. Average price remains stable impact on overall housing sales.
at $150,000, experiencing no change from one year ago.
Equally important has been the decline in consumer
The housing slowdown can be directly attributed to two confidence levels. This is especially true given that
factors—the decline in first-time buyers and waning buying a home is one of the largest financial com-
consumer confidence. The all-important kickstart mitments most people will make in their lifetime.
segment—the entry-level purchaser—has to some Market uncertainty is preventing many from real-
degree disconnected. Once a driving force, first-time izing homeownership this year.
buyers have taken a backseat to move-up purchasers,
many of whom are taking advantage of the current The good news is that the lingering effects of the
recession may soon be part of the past. Following an
PRINCE EDWARD ISLAND estimated 0.1 per cent modest contraction in GDP
Residential Unit Sales 2007 – 2010 in 2009, Prince Edward Island is forecast to return
2,000 to positive territory in 2010, with GDP rising as
much as two per cent, reflecting a recovery that is
expected to be somewhat reserved in nature.
1,500
0
2007 2008 2009* 2010**
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
$200,000
200000
Newfoundland
$175,000
$150,000
150000
& Labrador
$125,000
St. John’s
100000
$100,000
20072008 2008 2009**
2009* 2010***
2010**
While the province of Newfoundland and Labrador
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
is expected to see residential real estate sales fall back,
St. John’s itself is poised to reach its second-best year
on record, with 3,450 homes expected to change
in desirable areas such as Millidgeville, Quispamsis, hands by year-end 2009. Average price will surpass
and Rothesay will also climb. Garden homes, Saint the $200,000 benchmark, settling in at $215,000.
John’s response to the condominium lifestyle, will
remain a popular choice with empty nesters and The city of St. John’s has emerged as a standout in
retirees. Older, experienced buyers looking to down- 2009 within the province, given its better-than-
size to new homes with all the bells and whis- average performance. First-time purchasers remained
tles will also be an active segment of the market. the driving force throughout St. John’s, entering the
The supply of listings available for sale should market en masse to take advantage of low interest
tighten up in the second and third quarters of rates and buyer’s market conditions early in the year.
2010—creating a truly balanced housing market. Yet, the window of opportunity proved short-lived, as
By year-end 2010, unit sales are expected to match steadily increasing demand shifted the market back
2009 levels, while average price continues to climb, into balanced territory in the second half. Consumer
rising four per cent to $185,800. confidence in St. John’s continues to climb as prospects
for the future remain solid and momentum has now
filtered its way through all segments of the market.
ST. JOHN’S
Residential Unit Sales 2008 – 2010
4,000
3,500
-10% 4%
3,000
2,500
2,000
1,500
1,000
500
0
2008 2009* 2010**
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
$175,000
200000 With further growth in well-paying natural resource
sector jobs and employment opportunities created by
$175,000
capital works projects, housing sales will rise to 3,600
$150,500
units. Average price in St. John’s is forecast to maintain
double-digit appreciation, with an 11 per cent rise to
$125,000
150000 $238,650 forecast by year-end 2010, following a 15 per
2008 2008 2009**
2008 2009*2009** 2010***
2010**
2010
cent upswing the previous year. Market conditions
*Estimate **Forecast
Source: CREA, Local Real Estate Boards, RE/MAX
are expected to remain balanced, although if inventory
levels contract, seller’s market conditions could re-emerge.
Days on market are expected to decline to 30 to 45 days
With an unemployment rate hovering at 8.4 per cent next year, from 45 to 60 days in 2009. First-time buyers
(Newfoundland’s rate topped 17 per cent), St. John’s will continue to be the driving force, prompting half
has remained quite resilient despite the recession’s of all sales, while move-up buyers, in-migration and
impact throughout the rest of the province. In fact, investors account for the remainder. The upper end of
the city is among Canada’s leaders in employment the market should remain vibrant, moving ahead of
growth in 2009, and continues to benefit from strong year-ago levels. Given all the ingredients for positive
investment and capital spending. The construction growth going forward—including a rising population—
sector continues to fire on all cylinders and retail investors are already making their moves in antici-
spending remains ahead of year-ago levels. pation of strong returns down the road.
NATIONAL CONTACTS
RE/MAX of Western Canada Rhia Bachynski 416-250-3628
RE/MAX Ontario-Atlantic Canada Christine Martysiewicz 905-542-2400
RE/MAX Québec Sylvain Dansereau 450-668-7743
Point Blank Communications Eva Blay/Charlene McAdam 416-781-3911
LOCAL CONTACTS
Market Contact Office Phone
BRITISH COLUMBIA
Vancouver Richard Laurendeau RE/MAX Westcoast Realty 604-273-2828
Victoria Wayne Schrader RE/MAX Camosun 250-744-3301
Kelowna Cliff Shillington RE/MAX Kelowna 250-717-5000
ALBERTA
Edmonton Larry Westergard RE/MAX Real Estate 780-462-5000
Calgary Lowell Martens RE/MAX Real Estate (Mountain View) 403-247-5171
SASKATCHEWAN
Regina Rob Nisbett RE/MAX Crown Real Estate 306-789-7666
Saskatoon Larry Stewart RE/MAX Saskatoon 306-242-6000
MANITOBA
Winnipeg Alan Ediger RE/MAX Winnipeg 204-947-9800
ONTARIO
Sudbury Cathy Gregorchuk RE/MAX Crown Realty 705-560-5650
Ottawa Bill Lenardon RE/MAX Metro City 613-563-1155
Kingston Bob McKean RE/MAX Realty Concepts 613-389-7777
Barrie & District Corrie Holliday RE/MAX Chay 705-722-7100
Greater Toronto Area Debra Bain RE/MAX Hallmark 416-699-9292
QUÉBEC
Québec City Charles Rodrigue RE/MAX Capitale 418-627-3120
Montréal Claude Charron RE/MAX T.M.S. Inc. 450-430-4207
New BRUNSWICK
Saint John Gordon Breau RE/MAX Professionals 506-634-8200
NOVA SCOTIA
Halifax – Dartmouth Al Demings RE/MAX Nova 902-468-3400
NEWFOUNDLAND &
LABRADOR
St. John’s Jim Burton RE/MAX Plus Realty 709-738-7587