Saskatoon Home Prices See Slight Decline in Second Quarter of 2016: Royal LePage

Detached home segment more price-resilient than expected; condominium segment seeing some price softness

SASKATOON, July 13, 2016 – The aggregate house price in Saskatoon saw a modest decline in the second quarter of 2016, slipping 0.2 per cent year-over-year to $370,125, according to the Royal LePage House Price Survey and Market Survey Forecast released today.

When broken out by housing type, the median price of a two-storey home increased 1.0 per cent year-over-year to $421,214, while the median price of a bungalow rose 0.7 per cent to $366,030. During the same period, the median price of a condominium declined 9.5 per cent to $224,525.

“Higher unit inventory and price softness is providing a good range of choice for those in the market for condominiums,” said Matt Miller, broker, Royal LePage Saskatoon. “Despite a challenging economic environment, prices for detached homes in Saskatoon have remained steadier than many anticipated.”

Miller expects the market will continue to favour buyers for the remainder of the year as prices decline modestly compared to year end 2015.

Nationally, Canada’s residential real estate market continued to show strong appreciation in the second quarter of 2016, posting the highest national year-over-year gain seen in five years. Amid continued world economic uncertainty, the historically low-interest rate environment that has fueled Canada’s real estate market growth in recent years – most notably in Greater Vancouver and the Greater Toronto Area (GTA) – is expected to continue longer than anticipated. This extended period of low-cost borrowing will in turn further delay the cyclical cooling of Canada’s hottest real estate markets, originally forecasted for the second half of 2016.

The price of a home in Canada increased 9.2 per cent year-over-year to $520,223 in the second quarter of 2016. During the same period, the price of a two-storey home rose 10.7 per cent year- over-year to $619,671, the price of a bungalow increased 7.9 per cent to $437,121, and the price of a condominium increased 4.2 per cent to $348,189. Looking ahead to the remainder of 2016, Royal LePage forecasts that the aggregate price of a home in Canada will increase 12.4 per cent when compared to year end 2015.

“Our forecasting models, which pointed to a slowing housing market as the year progressed, included a modest increase in the cost of borrowing,” said Phil Soper, president and chief executive officer, Royal LePage. “Economic and social disruptions have rocked the world once again, introducing new risks and making it very likely that the Bank of Canada will leave interest rates as-is for now. Few industries are as rate sensitive as real estate. We don’t see even a mild correction for either the Toronto or pistol-hot Vancouver markets in 2016.”

“Our call for 12.4 per cent national price appreciation in the final quarter of this calendar year as compared to the final quarter of last year, is a landmark in Canada. I believe it is the highest value put forward by any serious forecasting agency since the turn of the century,” added Soper.

About the Royal LePage House Price Survey

The Royal LePage House Price Survey provides information on the three most common types of housing in Canada, in 53 of the nation’s largest real estate markets. Housing values in the House Price Survey are based on the Royal LePage National House Price Composite, produced quarterly through the use of company data in addition to data and analytics from its sister company, Brookfield RPS, the trusted source for residential real estate intelligence and analytics in Canada. Commentary on housing and forecast values are provided by Royal LePage residential real estate experts, based on their opinions and market knowledge.

About Royal LePage

Serving Canadians since 1913, Royal LePage is the country’s leading provider of services to real estate brokerages, with a network of over 16,500 real estate professionals in more than 600 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage Shelter Foundation, dedicated to supporting women’s and children’s shelters and educational programs aimed at ending domestic violence. Royal LePage is a Brookfield Real Estate Services Inc. company, a TSX-listed corporation trading under the symbol TSX:BRE.

Saskatoon apartment prices tumble in Q1, 2016

Here’s a bit of the media coverage the resulted from the recent release of Royal LePage’s House Price Survey for the first quarter of 2016.

Read also, from the Star Phoenix: New inventory causes condo market to soften: Royal LePage

I would like to point out that the data from this report comes from Brookfield Real Estate Service’s database which is generated from appraisals completed in the area, and not from the MLS® where we typically get our data from.

This study shows apartment condos being down 10.1 percent from the first quarter of last year, which is pretty much in-line with the change to the average MLS® selling price of an apartment, which fell 9.3 percent year-over-year. However, the MLS® Home Price Index which is intended to track values of very specific housing types (apples to apples comparision) shows just a 6.7 percent year-over-year decline in this category.

While town houses are most often “condos” by definition, the MLS® Home price Index shows that they have faired quite well over the past year in comparison to apartments.

The Royal LePage study shows two-storey homes in Saskatoon being up 1.5 percent over the first quarter, compared to the same period last year. The MLS® Home Price Index shows a smaller increase of just .32 percent.

The Royal LePage study shows bungalow prices to have grown by 0.7 percent when compared with those trading in the first quarter of last year. The MLS® Home Price Index actually reports a loss of 3.15 percent from a year ago. The MLS Index uses “one-storey” rather than bungalow, so it will include bi-levels as well.

Finally, I’d also point out that Royal LePage’s study compares activity over the full first quarter of each year while the MLS® Home Price Index compares prices at the end of the quarter so there are going to be some differences that result from that as well.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Vidorra

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New condominium inventory putting downward pressure on prices: Royal LePage

SASKATOON, April 7, 2016 – The aggregate price* of a home in Saskatoon remained relatively flat in the first quarter of 2016, slipping 0.3 percent year-over-year to $373,658, according to the Royal LePage House Price Survey** released today.

When broken out by housing type, the median price of a two-storey home increased 1.5 percent to $464,630 while the median price of a bungalow rose 0.7 percent year-over-year to $366,113.  During the same period, condominium prices fell 10.1 percent year-over-year to $226,186.

“The number of completed and unabsorbed condos is up 35 percent over last year. New units resulting from condominium development projects that started two years ago are now coming onto the market and generating a spike in inventory in this segment,” said Norm Fisher, owner and broker, Royal LePage Vidorra. “This is leading to some price softness in the condominium segment and creating a window of opportunity for buyers.”

Nationally, Canada’s residential real estate market showed strong year-over-year price increases in the first quarter of 2016.  The Greater Vancouver and Greater Toronto Area (GTA) real estate markets continue to lead the country in home price appreciation, with Canada’s economic landscape supporting robust housing demand in these metropolitan areas.  Additionally, an emerging trend of inter-provincial migration to British Columbia and Ontario from commodity-focused economic regions such as Alberta is expected to put further upward pressure on home prices in these areas in the coming months.

The price of a home in Canada increased 7.9 percent year-over-year to $512,621 in the first quarter of 2016.  The price of a two-storey home rose 9.2 percent year-over-year to $629,177, and the price of a bungalow increased 6.8 percent to $426,216.  During the same period, the price of a condominium increased 4.0 percent to $344,491.

“A glance at our national house price composite points to a very strong Canadian real estate market, yet the findings contain extreme regional disparities of the kind we haven’t seen in over a decade,” said Phil Soper, president and CEO, Royal LePage. “Like an economic triumvirate, the impact of rock-bottom interest rates, the low Canadian dollar and a rapidly expanding U.S. workforce are stimulating economic growth and housing demand in our largest metropolitan areas. Conversely in cities like Calgary, the ongoing drags in depressed energy prices and worrisome employment trends have taken a material bite out of sales volumes. As a lagging indicator, home prices in Alberta and Newfoundland are just beginning to adjust to the lower demand.”

“Redistribution of labour across the country is further reinforcing disparities among housing markets, as the broader impacts of the oil recession on Alberta’s economy take hold.  For the first time in many years, we are witnessing an out-migration trend in the province, as economic conditions and employment prospects dim,” continued Soper. “We expect British Columbia, followed by Ontario, to be the top recipients of new household inflows in the coming year, which will further fuel housing demand and price appreciation in Greater Vancouver and the GTA.  This is in sharp contrast to the situation from 2011 to 2014, and in the mid 2000’s, when a booming energy sector attracted families from all over Canada to Alberta.”

About the Royal LePage House Price Survey

The Royal LePage House Price Survey provides information on the three most common types of housing in Canada, in 53 of the nation’s largest real estate markets. Housing values in the House Price Survey are based on the Royal LePage National House Price Composite, produced quarterly through the use of company data in addition to data and analytics from its sister company, Brookfield RPS, the trusted source for residential real estate intelligence and analytics in Canada.  Commentary on housing and forecast values are provided by Royal LePage residential real estate experts, based on their opinions and market knowledge.

About Royal LePage

Serving Canadians since 1913, Royal LePage is the country’s leading provider of services to real estate brokerages, with a network of over 16,000 real estate professionals in more than 600 locations nationwide. Royal LePage is the only Canadian real estate company to have its own charitable foundation, the Royal LePage Shelter Foundation, dedicated to supporting women’s and children’s shelters and educational programs aimed at ending domestic violence. Royal LePage is a Brookfield Real Estate Services Inc. company, a TSX-listed corporation trading under the symbol TSX:BRE.

*Aggregate prices are calculated via a weighted average of the median values of homes for reported property types in the regions surveyed

**Powered by Brookfield RPS

Norm's recap of Q2-2014 Saskatoon real estate activity with Global News

I had the opportunity to sit down with Kevin Stanfield from Global News on Friday to discuss findings of the Royal LePage House Price Survey for the second quarter of 2014. While I have done several television interviews in the past, this experience was my first live appearance which required a 6:30 am visit to the studio. It was fun.

Anyway, this four minute clip provides a bit of an overview on market sales and listing activity through Q2, as well as my prediction on what you might expect for the balance of 2014. We also discuss the “$1-million plus” real estate market in Saskatoon.

Get the most current market intelligence with our FREE Market Snapshot including prices of homes recently sold in your area. Get it here, now.

I’m always happy to answer your Saskatoon real estate questions.  All of my contact info is here. Please feel free to call or email.

Norm Fisher
Royal LePage Saskatoon Real Estate

Saskatoon house prices show just moderate growth in Q2, 2014: Royal LePage

rlp_hps_q2_14SASKATOON, July 9, 2014 – The Royal LePage House Price Survey and Market Survey Forecast released today showed moderate growth for most housing types surveyed.

The average price of a standard condominium in Saskatoon saw the largest growth, with an increase of 2.9 per cent to $261,333. Meanwhile, detached bungalows increased 1.6 per cent to $375,000 while standard two storey homes rose just 1.3 per cent to 399,250.

“We saw the strongest price increase this quarter in the condo segment, in large part due to a higher percentage of newer units having sold,” said Norm Fisher, sales manager, Royal LePage Saskatoon. “Detached bungalows saw a slight increase in average price due to a lack of units available, while standard two-storey homes saw just modest increases because of surplus supply, which is the highest we have seen since 2009.

According to Fisher, prices are more stable due to a combination of factors that include a slowdown in immigration, which had been fuelling the Saskatoon market, and a slowing potash sector.

Looking ahead to the remainder of 2014, Fisher forecasts the continuation of stronger than normal demand for housing while increased residential inventory levels keep prices from rising further.

“We have now passed the spring rush, which is traditionally followed by a period of slow but steady declines in unit sale numbers as we approach year end, so average prices are likely to be on par with 2013 prices by the end of the year.”

Nationally, with the harsh winter now a fading memory, the average price of a home in Canada increased between 3.9 and 5.2 per cent in the second quarter of 2014. According to Royal LePage, price increases were posted across housing types, with detached bungalows seeing the highest year-over-year gains, rising 5.2 per cent to an average price of $406,454. Meanwhile, standard two-storey homes rose 5.1 per cent year-over-year to $440,972, while standard condominiums posted gains of 3.9 per cent to $258,501.

“Chronic supply shortages are driving price spikes in Canada’s major cities, masking otherwise moderate home price appreciation nationally,” said Phil Soper, president and chief executive of Royal LePage. “While a widening affordability gap in Canada’s largest urban centres is characterizing the national market Canadians read about daily, year-over-year house price increases in most regions of the country are presently tracking below the historical average.”

Looking ahead at the remainder of 2014, Royal LePage is projecting that the national average house price will increase at 5.1% per cent for the full-year. “Compared to other major forecasts, our year-beginning national outlook predicted a higher level of 2014 average price appreciation, yet supply constraints in a handful of our largest cities necessitate a revision upwards,” noted Soper. “Looking ahead to 2015, we expect house prices to track more closely to the rate of general economic growth. That is, we see price increases in Canada’s largest cities moderating, just as our smaller city markets should see a lift.”