The aggregate price of a home in Canada has continued to post steady year-over-year gains during the third quarter of 2019, which is why Royal LePage is urging candidates to use caution when making election promises aimed at stimulating housing demand that lack concrete plans.
“It is encouraging to see our political leaders devote thought and time toH housing issues during the federal election,” said Phil Soper, president and CEO of Royal LePage. “With the fastest growing population among advanced economies worldwide, providing adequate shelter for Canada’s rapid pace of household formation presents an economic opportunity and a social challenge.”
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 median price of a home in Canada increased 1.4 per cent year-over-year to $630,335 in the third quarter of 2019.
The median price of a two-storey home rose 1.3 per cent year-over-year to $738,346, while the median price of a bungalow remained flat at $521,250. Nationally, condominiums remained the fastest appreciating housing type, with the median price rising 3.4 per cent year-over-year to $457,911.
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“Well-intentioned election promises aimed at making housing more accessible and affordable to first-time buyers will fall flat if they trigger a surge in demand without a corresponding increase in the supply of homes. For example, lowering monthly mortgage payments by stretching repayment over a longer time period looks great on the surface, yet a surge in new buyers could cause prices to escalate, erasing the enhanced purchasing power,” Soper continued. “Low interest rates and an outstanding employment picture continue to buoy consumer confidence and support our recovering real estate market. Our outlook for Canada’s housing sector is for continued market expansion.”
Looking to the fourth quarter of 2019, Royal LePage forecasts that the aggregate price of a home in Canada will rise 1.5 per cent year-over-year to $632,226, which is a 0.3 per cent increase compared to the third quarter of 2019. However, the 2019 fourth quarter forecast is dependent on consistent economic conditions and no new housing policy changes.
According to Royal LePage, Brampton’s proximity to Toronto and relative affordability continued to attract condominium buyers. The median price of a condominium increased 6.7 per cent on a year-over-year basis, to $400,641. Meanwhile, the median price of a standard two-storey and bungalow increased 3.4 per cent and 4.0 per cent year-over-year to $752,065 and $661,583 respectively. Overall, the aggregate price of a home increased 3.5 per cent year-over-year to $727,259.
And, what about the rest of the GTA and Toronto?
Condominiums in Toronto have surpassed the $600,000 mark, rising to $618,391 while the median price of a two-storey home in the city centre rose 5.5 per cent.
In the fourth quarter, Royal LePage forecasts the aggregate price of a home in the Greater Toronto Area to be relatively flat quarter-over-quarter at $859,301, which is a 3.1 per cent increase over the fourth quarter of 2018.
What do you think about Royal LePage’s comment on election promises about housing demands?