Langley Real Estate

Royal Lepage, newswire.com

Condos perform well, while diminishing supply and offshore buyers keep single family homes in high demand

VANCOUVER, Jan. 6 /CNW/ - Year-over-year, fourth-quarter 2010 house prices in Vancouver were up across the board according to the Royal LePage House Price Survey and Market Survey Forecast released today. The biggest gain came from single family homes on Vancouver's West Side.

Standard two-storey homes led the way, with average price gains across all neighbourhoods of 9.8 per cent over the same period last year, selling for a fourth quarter average of $1,007,500. Detached bungalows followed with year-over-year gains of 7.6 per cent, selling for a fourth quarter average of $891,500. Standard condominiums were close behind, selling for an average price of $484,500, a gain of 7 per cent.

While single family homes continued to dominate the market in terms of price gains, condos performed well across Metro Vancouver, particularly on the East Side.

"Condos are a big part of the Vancouver market because of the price point," said Bill Binnie, broker and owner of Royal LePage North Shore. "Condos are an investment vehicle, and many people downsize from single family homes to change their lifestyle. Plus, many new condos offer a 'bling' factor , such as granite counter tops, which is attractive to buyers." Eighty per cent of downtown properties sold in the fourth quarter were condos.

Vancouver buyers are being brought to the market by continued historically low interest rates and softening prices from the third quarter of 2010. Tight inventory and high prices in Vancouver's West Side are pushing up prices in the East Side, particularly for single family homes.

"West Side and West Vancouver homes are unaffordable for many people," said Chris Simmons, broker and owner of Royal LePage Westside & City Centre. "Buyers started looking to the East Side or Richmond."

Vancouver house prices are forecast to increase 3.7 per cent in 2011, while inventory is expected to grow 8 per cent. Interest rates will continue to be the most important factor, followed by employment levels.

Simmons added that one of the best times to buy is January, before competition picks up in spring.

Nationally, the average price of a home increased between 3.9 and 4.6 per cent in the fourth quarter of 2010, compared to the previous year, as markets shrugged off a lackluster third quarter and returned to a post-recession growth profile. Home values are forecast to continue a moderate and steady climb in many of the country's key housing markets through 2011 with sales activity skewed to the first half of the year.

"Trends in the housing market continue to be driven by the lingering after-effects of the recession," said Phil Soper, president and chief executive of Royal LePage Real Estate Services. "Canadians realize that interest rates are unsustainably low and that homes will become effectively more expensive when mortgage rates return to normal levels. We will likely see more price appreciation early in 2011 as some buyers complete transactions in advance of anticipated higher borrowing costs."

Across Canada, the average price of a home is forecast to rise 3 per cent over the coming year to $348,600 while the number of transactions is expected to drop 2 per cent.

About the Royal LePage House Price Survey

The Royal LePage House Price Survey is the largest, most comprehensive study of its kind in Canada, with information on seven types of housing in over 250 neighbourhoods from coast to coast.  This release references an abbreviated version of the survey, which highlights house price trends for the three most common types of housing in Canada in 80 communities across the country.  A complete database of past and present surveys is available on the Royal LePage Web site at www.royallepage.ca.  Current figures will be updated following the complete tabulation of the data for the fourth quarter 2010. A printable version of the fourth quarter 2010 survey will be available online on February 4^th, 2011.

Housing values in the Royal LePage House Price Survey are Royal LePage opinions of fair market value in each location, based on local data and market knowledge provided by Royal LePage residential real estate experts.  Historical data is available for some areas back to the early 1970s.