CANADIAN REAL ESTATE MARKET RELATIVELY RESILIENT DURING FIRST QUARTER

Only modest house price declines despite predictions of double digit depreciation

TORONTO, April 8, 2009 – Consistent with current economic trends, Canadian residential real estate prices declined during the first quarter, according to a quarterly House Price Survey released today by Royal LePage Real Estate Services Ltd.  As the market correction unfolds, year-over-year home prices were lower, as was expected. Increased buyer activity at the end of March suggests that spring will bring its typical increase in unit sales activity as buyers target summer moves.

Regional disparities in quarterly housing prices showed markets in Atlantic Canada outperforming other areas of the country as hardy local economies spurred house price growth across the three housing types surveyed.  Markets in central Quebec and eastern Ontario held steady with areas of modest growth and limited declines. In the balance of Ontario, and in particular the Greater Toronto Area, prices retreated from the record levels set in the first quarter of 2008, with most trading areas showing mid to low single digit declines.  With the exception of Manitoba, western provinces saw significant changes as the rapid run-up in prices experienced earlier in the decade gave way to double-digit declines in most regions.  As market corrections in B.C. and Alberta were underway well ahead of the full impact of the current economic crisis, it is suggested that these areas may be first in Canada to stabilize.

 “We expected a sharper decline in house prices across Canadian markets during the first quarter,” said Phil Soper, president and chief executive officer, Royal LePage Real Estate Services Ltd.  With economic hardship dominating our global consciousness, it was predictable that dwindling consumer confidence would continue to drive prices lower.  But markets were relatively resilient during the period. Soper continued, “Canadians in most regions should not expect the prices of their homes to begin appreciating again until the overall economy begins to stabilize, likely in the first half of 2010.” 

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