MARIE & KIM TAVERNA

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Sluggish Start to 2019 Provides Silver Lining for First-time Home Buyers in the Country’s Largest Cities

  • National home price growth slowed to 2.7 per cent year-over-year in the first quarter of 2019
  • Home prices in western Canada forecast to decline
  • Price growth in the Greater Toronto Area (GTA) remains steady, supported by low inventory
  • Slowdown in Greater Vancouver driven by policy changes
  • Greater Montreal Area home price growth continues to outpace the GTA and Greater Vancouver
  • Ottawa home prices inch ahead of Calgary for the first time

TORONTO, April 4, 2019 – According to the Royal LePage House Price Survey[1] released today, Canada’s residential real estate market showed slowing year-over-year price growth in the first quarter of 2019.

Early in 2018, Canada experienced the most significant housing correction since the 2008 financial crisis. Markets showed signs of recovery late in the year, yet the figures for early 2019 suggest that the market has once again slowed.

The Royal LePage National House Price Composite, compiled from proprietary property data in 63 of the nation’s largest real estate markets, showed that the price of a home in Canada increased just 2.7 per cent year-over-year to $621,575 in the first quarter of 2019, well below the long-term norm of approximately 5 per cent. When broken out by housing type, the median price of a two-storey home rose 2.6 per cent year-over-year to $729,553, while the median price of a bungalow rose 1.1 per cent year-over-year to $513,497. Condominiums remained the fastest growing housing type on a national basis, rising 5.4 per cent year-over-year to $447,260.

Looking ahead to the second quarter, Royal LePage expects national home prices to stay relatively flat throughout the 2019 spring market, with the national aggregate price of a home increasing 1.0 per cent over the next three months. Meanwhile, the housing markets in several larger Canadian cities have shown noticeable signs of slowing, with nearly half of the regions in Royal LePage’s Quarterly Forecast[2] anticipating quarter-over-quarter price declines. Notably, Royal LePage is expecting home prices in Greater Vancouver to fall 1.4 per cent over the next quarter. Ottawa is expected to post the highest price appreciation during the spring market and is forecast to rise 2.8 per cent to $482,459 during the second quarter.

“We are expecting this to be a sluggish year overall in Canada’s residential real estate market, with the hangover from the 2018 market correction and weaker economic growth acting as a drag on home price appreciation, balanced by lower for longer interest rates,” said Phil Soper, president and CEO, Royal LePage. “There is a silver lining here. This slowdown gives buyers, and first-time buyers in particular, an opportunity to buy real estate in our country’s largest cities.”

The global economy hit a soft spot entering the new year. The economic downturns in China and Germany, ongoing trade disputes, and slowing U.S. growth support a relatively muted global outlook. The upside for the Canadian housing market is the increased likelihood that interest rate hikes are on hold for the foreseeable future.

“Canada is certainly affected by negative global macroeconomic trends, yet full-time job creation in our country is very strong, and full-time employment turns renters into buyers,” said Soper. “The medium-term outlook for housing remains very positive.”

In the federal budget tabled by Finance Minister Bill Morneau in March, the Canadian government announced three new or enhanced housing programs. The First-Time Home Buyer Incentive is a three-year, $1.25 billion shared equity mortgage program whereby the Canadian Housing and Mortgage Corporation (CMHC) will co-invest up to five per cent of the purchase price of an existing home. Further, for the first time in a decade, there was an increase in the registered retirement savings plan withdrawal limits in the Home Buyers Plan. The increase, from $25,000 to $35,000, was the largest since the program’s inception in 1992. Finally, an additional $10 billion in financing over nine years was earmarked for the construction of purpose-built rental housing.

“Like many government initiatives, the new housing programs have supporters and critics,” said Soper. “Prospective home buyers and the hundreds of thousands of Canadians who directly or indirectly earn their living from real estate activity should remember that there were many policy areas competing for attention. In 2019, housing captured the attention and support of federal lawmakers, which is a welcome and necessary development.

Some critics believe that the narrowly focused federal housing initiatives will overstimulate already expensive markets. We disagree. Eroding affordability risks taking the dream of homeownership away from young Canadian families,” said Soper. “Without a healthy influx of first-time buyers, the entire cycle of real estate activity can stall. There is the chance, however, that activity levels in the spring of 2019 will be reduced as some delay purchases, waiting for the First-Time Home Buyer Incentive to kick-in.”

Driven by supply-side shortages, and augmented by an improving job market, home price appreciation in Ontario heavily influenced the national results in the first quarter of 2019. If Ontario is excluded from the Royal LePage National House Price Composite, Canadian price appreciation would sit at a modest 0.4 per cent increase compared to 2.7 per cent.

“The City of Toronto is still one of Canada’s fastest appreciating real estate markets,” said Soper. “Detached home prices are rising in line with inflation, but condominium prices are increasing at near double-digit levels as vertical living has become the primary new-build option in this growing, world-class city.”

Median home prices in the City of Toronto rose 5.8 per cent year-over-year in the first quarter of 2019. Two-storey home prices and bungalow home prices rose 4.8 per cent and 2.5 per cent year-over-year, respectively, while condo prices rose a weighty 9.3 per cent year-over-year. The overall GTA’s aggregate home price rose 3.4 per cent over the same period.

Real estate values in Ontario’s Golden Horseshoe region continued to appreciate at a brisk clip, as local economies grew and workers from the GTA looked to trade commuting time for lower house prices. Niagara/St. Catharines, Hamilton, and Kitchener/Waterloo/Cambridge aggregate prices were up by 6.9 per cent, 6.3 per cent and 8.9 per cent, respectively.

In eastern Ontario, Ottawa home prices appreciated by 7.7 per cent year-over-year. One of the principal advanced technology regions in North America, and home to much of the federal government’s labour force, household formation in the national capital region has been robust. The aggregate price of a home in Ottawa has now surpassed that of Calgary for the first time, a trend unforeseen five years ago.

Other notable price increases for Ontario cities include Kingston at 10.3 per cent increase, and in western Ontario, London and Windsor both experienced double-digit home price increases, rising 10.7 per cent and 12.4 per cent year-over-year, respectively.

While the overall provincial economy remains strong in British Columbia, its housing market remains vulnerable as government intervention continues to drive down real estate activity. For the first time since 2012, Greater Vancouver home prices declined year-over-year, with the aggregate price dipping 1.5 per cent for the first quarter of 2019 to $1,239,306, while overall listing volumes are increasing.

“The Greater Vancouver area remains one of the most desirable places to live in the world. Population growth is driving household formation and employment levels high. Yet policy intervention has induced a drop in home sales to levels not seen in three decades,” Soper said. “Hammering consumer confidence and artificially choking off demand with a series of new taxes and restrictive regulations doesn’t eliminate the need for new housing, it simply sidelines families in the short-term and fuels a disruptive boom-bust cycle.”

Some of the most desirable regions in Greater Vancouver are seeing home price declines. Properties in the region’s higher-end markets like West Vancouver, North Vancouver, Burnaby, and the City of Vancouver are all declining in price offering buyers seeking luxury housing a rare window of opportunity to enter some of Canada’s highest priced markets.

Despite a recent rally in world oil prices, activity levels in the Canadian energy sector remain muted. While it is unlikely that the province will enter a technical recession, economic activity in Alberta is forecast to remain sluggish. The aggregate price of a home in Calgary, Edmonton, and Fort McMurray fell marginally by 1.5 per cent, 1.0 per cent, and 0.8 per cent to $468,974, $371,782 and $576,211, respectively.

In the first quarter of 2019, the aggregate price of a home in the Greater Montreal Area increased 5.5 per cent year-over-year to $406,332. The rate of home price appreciation in the Greater Montreal Area once again surpassed rates seen in the GTA (3.4 per cent), Greater Vancouver (-1.5 per cent) and the national average (2.7 per cent). All three reported housing types saw gains this quarter, with median home prices for two-storey homes, bungalows, and condominiums rising 6.4 per cent to $514,412, 3.7 per cent to $316,159 and 5.2 per cent to $328,488, respectively.

Economic activity in Atlantic Canada remains a mixed bag. Prince Edward Island is seeing solid economic growth, but persistently high unemployment rates have resulted in an aggregate price increase for a Charlottetown home of only 0.7 per cent year-over-year to $288,230. The demographics in Nova Scotia are favourable, as the province is benefiting from higher immigration and interprovincial migration numbers, and the region has a strong export sector. The aggregate price for a home in Halifax increased 1.6 per cent year-over-year to $318,733.

Meanwhile, the outlook for New Brunswick is mixed, with forecasters anticipating gains from an improving commodity sector will offset a declining population and an 8.5 per cent unemployment rate. In the first quarter, the aggregate price of a home in Saint John increased 1.9 per cent year-over-year to $213,290, while the aggregate price for a home in Moncton decreased 1.3 per cent year-over-year to $192,185. Similarly, the economy in Newfoundland and Labrador is sending mixed signals, as the current unemployment rate is 11.8 per cent but natural resource projects like the syndicate-operated Hebron Project, Husky’s White Rose oil field, and Vale’s Voisey’s Bay nickel mine are all expected to ramp up production. The aggregate price of a home in St. John’s decreased 5.6 per cent year-over-year to $324,955.

Read more about regional trends here.

Aggregated regions and the Royal LePage National House Price Composite (.PDF)

Q2 2019 Royal LePage Quarter-over-Quarter Forecast (.PDF)

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Spring 2019 | Volume 17, Issue 2

 
 
 

Canadian real estate market begins recovery from the most significant housing correction in a decade

 
 
 

According to the Royal LePage House Price Survey1, year-over-year home prices made healthy gains in many regions across Canada in the fourth quarter of 2018, continuing the recovery from the most significant housing correction since the financial crisis. Once again, the Greater Montreal Area saw the highest year-over-year home price appreciation rate of the three largest Canadian metropolitan areas studied.

The Royal LePage National House Price Composite, compiled from proprietary property data in 63 of the nation's largest real estate markets, showed that the price of a home in Canada increased 4.0 per cent year-over-year to $631,223 in the fourth quarter of 2018. When broken out by housing type, the median price of a two-storey home rose 3.9 per cent year-over-year to $745,007, while the median price of a bungalow climbed 1.5 per cent to $516,950. Condominiums continued to see the highest rate of appreciation nationally when compared to the detached segment, rising 7.2 per cent year-over-year to $447,915.

"The invisible hand that guides our complex economy hit the real estate reset button in 2018 and that is a good thing," said Phil Soper, president and CEO, Royal LePage. "Major market home price inflation through much of the decade had led to dangerous overheating in our most populous regions. Government regulatory intervention and rising interest rates, when combined with property price overshooting, triggered the correctional cycle we find ourselves working through today."

The Canadian economy is performing well overall, with pockets of uncertainty. Persistently weak oil prices driven by domestic market access bottlenecks and global supply gluts have hit Western Canada hard, and trade tensions between China and the U.S. in particular are impacting consumer confidence across the continent.

"While some economists are adjusting their forecast for the economy as a whole, Canada's real estate market is beginning to emerge from the correction that began a year ago. The national real estate market is stable and should see modest price gains by the end of the 2019," said Soper.

Royal LePage projected modest home price appreciation in 2019 in its recent forecast, expecting the aggregate price of a home in Canada to rise 1.2 per cent in Canada over the next year.

To view the chart with aggregated regions and markets visit www.royallepage.ca/houseprices

For more information see www.royallepage.ca/mediaroom

1 Aggregate prices are calculated using a weighted average of the median values of all housing types collected. Data is provided by RPS Real Property Solutions.

 
 
 

Your Spring maintenance checklist

 
 
 

Maintaining your home is crucial in preserving its value. By taking small actions throughout the year, you can save money by catching problems early, or even prevent them, before significant damage takes place. As soon as the snow thaws it's the best time to do the rounds, both inside and outside your home, to make sure everything is working the way it should.

 
  infographic  
     
   
 
 

Create a stress-free kitchen

 
 
 

No matter its size, most people feel like there is never enough space in their kitchen. While ample space is key for a great kitchen, organizing it properly can save time too. After all, it is the most used room of a home. Here are some helpful tips to create a functional and stress-free kitchen.

Give each cabinet a purpose. The first step is to group

   
 

items and give each group a designated space. Not only will this allow you to find every item easily, you are less likely to use the space for items that don't belong there. Limit bottom cabinets to cleaning supplies, large pots or appliances and items that are rarely used.

Put items you need the most in easy to grab spots. Measuring spoons, oven mitts and your go-to saucepan should be quickly accessible for stress-free, day-to-day use. Also, by keeping items close to where they are most used, you will find everything is exactly where you need it.

Increase visibility in your fridge and pantry. Clear containers and additional shelving will allow you to quickly locate items in your fridge. As for your pantry, consider using clear stackable bins, adjusting your shelves and work in levels. Adding a little light will go a long way!

Think outside the kitchen. Fancy dishes, large appliances that haven't been used in months and unread cookbooks are great examples of items that do not need to be stored in your kitchen. Finding new homes for less-used items outside the kitchen is one of our favourite space-saving ideas.

 
     
   
 
 

Go for it! Paint your front door

 
 
 

A vibrant red, bright turquoise, regal blue or even mustard yellow. Bold colour choices can make your home stand out. With warm sunny days around the corner, it's the perfect time to plan an exterior paint project. Here is some advice to get you started.

  • Don't only look for an exterior paint, make sure the paint you choose is right for the door's material

   
 

(wood, metal). Be sure to remember if you choose an oil-base or latex paint, as you can't switch back and forth, for the inevitable future touch-ups.

  • Tape your colour swatch to the door and see how the colour looks at different times during the day.

  • Pick a warm, dry day and get started early! Before painting, you will need to remove your door and the hardware from its surface.

  • Thoroughly clean the door so dirt does not get trapped in the paint.

  • Don't forget to use a primer coat. It's the best way to get the most out of your new colour.

 
     
   
 
 

Honoured with prestigious philanthropy award

 
 
 

Royal LePage Shelter Foundation has received the 2018 Philanthropy Award for Outstanding Corporation from the Association of Fundraising Professionals, Greater Toronto Chapter. Presented to a corporation or its charitable foundation, this award celebrates the contribution of time, leadership and financial support of a special group of Canadians who set new benchmarks of excellence in the acts of giving and volunteering.

   
 

"We are honoured to have been nominated by our partner, Canadian Women's Foundation, and to be recognized as philanthropic leaders," said Phil Soper, president and CEO, Royal LePage. "This award reflects the tireless and passionate efforts of our national network of REALTORS® and broker-owners who support the Royal LePage Shelter Foundation and its mission to promote safer homes and communities."

Royal LePage Shelter Foundation has raised more than $29 million in its 20 year history and helps local women's shelters provide a safe haven and new beginnings for more than 50,000 women and children every year. It is the largest public foundation in Canada dedicated exclusively to supporting women's shelters and domestic violence prevention programs. Royal LePage offices are partnered with a women's shelter in their community and agents make donations from their sales commissions, organize fundraising events and provide in-kind contributions.

"I am so grateful to Royal LePage agents, brokers and employees for their unwavering determination to help women and children lead safer, happier and more hopeful lives. I am thrilled that their efforts are being recognized with the 2018 Philanthropy Award for Outstanding Corporation," said Shanan Spencer-Brown, executive director, Royal LePage Shelter Foundation.

Royal LePage is the only major real estate company with its own charity. The company pays all of the Foundation's administrative costs allowing the total amount raised to remain in local communities. Learn more at www.royallepage.ca/shelter.


11th Annual National Garage Sale for Shelter
Saturday, May 11, 2019

Mark your calendars!
Held at Royal LePage offices and on front yards and driveways across Canada, the National Garage Sale for Shelter raises critical funds for local women's shelters that offer safety and support to thousands of women and children fleeing domestic violence each year.

Since 2009, the National Garage Sale for Shelter has raised $3 million for women's shelters across the country. Because Royal LePage Canada covers the foundation's administrative costs and sponsors underwrite event expenses, 100% of all funds raised go directly to this important cause.

How can you help?
Please donate gently used items to a participating Royal LePage office and visit the National Garage Sale for Shelter in your community to shop for great deals and unique treasures. You'll be helping women and children escape abuse and create a future that is safe and full of hope.

For more information, please contact the Royal LePage office in your community or email shelterfoundation@royallepage.ca.

 
     
   
 
 
     
 
   
 
  Marie Taverna  

Marie Taverna

Real Estate Agent

604.351.0141


kmtaverna@gmail.com

MarieTaverna.com

 
 
 

2185 Austin AVENUE

Coquitlam ,  BC V3K3R9

Brokerage Phone: 604.939.6666

 


 
 


 

 
     
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