Despite seeing a healthy amount of demand, high inventory levels contribute to slight decreases in pricing across the region

SASKATOON, July 13, 2017 – According to the Royal LePage House Price Survey1 and Market Survey Forecast released today, the aggregate price of a home in Saskatoon dipped slightly in the second quarter of 2017, slipping by 1.7 per cent year-over-year to $379,864.

When broken out by housing type, the median price of a two-storey home and bungalow both declined by 1.7 per cent year-over-year to $409,633 and $345,868, respectively.

“Saskatoon’s residential real estate market continued to march onwards in the second quarter of 2017, producing sales figures that are on par with the same time last year,” said Norm Fisher, broker and owner, Royal LePage Vidorra.

“While inventory is at an all-time high, home prices have been supported by modest population and job growth, combined with continued low interest rates.”

Looking ahead, Fisher forecasts that pricing and sales activity will soften slightly by the end of the year, as high inventory levels and a seasonal slowing of demand dampens the market.

Nationally, Canada’s residential real estate market posted strong home price gains in the second quarter of 2017, with the majority of metropolitan markets across Canada displaying expansionary trends. During the quarter, the Royal LePage National House Price Composite showed that the price of a home in Canada increased 13.8 per cent year-over-year to $609,144. When broken out by housing type, the price of a two-storey home rose 14.6 per cent year-overyear to $725,391, while the price of a bungalow increased by 10.7 per cent to $511,965. Over the same period, the price of a condominium climbed 13.4 per cent to $397,826.

“Following a period of unprecedented regional disparity in activity and price appreciation, we are now seeing a return to healthy growth in the majority of Canadian housing markets,” said Phil Soper, president and CEO, Royal LePage.

“The white-hot markets are moderating to very warm; the depressed markets are beginning to grow again. Canadian housing is in great shape – a statement that I certainly did not make last quarter.”

“The rate of national house price appreciation that we experienced in the second quarter continues to be above what we would consider a normal range, driven primarily by very strong year-over-year price growth across much of Ontario,” continued Soper.

Looking ahead to the remainder of the year, Royal LePage forecasts that the national aggregate price of a home will increase by 9.5 per cent in 2017 to $617,773 when compared to year-end, 2016. 

Read also: Global News - Home Prices in Saskatoon continue to slide: Royal LePage

Significant inventory and soft demand create a buyer’s market SASKATOON,

April 18, 2017 – According to the Royal LePage House Price Survey1 released today, the aggregate price of a home in Saskatoon dipped slightly in the first quarter of 2017, decreasing 0.5 per cent year-over-year to $385,980.

When broken out by housing type, the median price of a two-storey home declined 1.5 per cent year-over-year to $412,795. During the same period, the median price of a bungalow increased modestly by 0.9 per cent year-over-year to $355,623.

“A persistent supply of inventory is giving buyers the edge across several price ranges and property types in Saskatoon,” said Norm Fisher, broker and owner, Royal LePage Vidorra.

“When coupled with a continued low interest rate environment, the surplus in listings has kept Saskatoon’s housing market relatively affordable when compared to many other larger cities in Canada. Even though low resource prices are having an impact on employment and population growth in Saskatoon, home prices have been remarkably resilient in the face of tough times.”

Nationally, Canada’s residential real estate market saw substantial price growth in the first quarter of 2017, increasing 12.6 per cent year-over-year to $574,103. The price of a two-storey home rose 13.9 per cent year-over-year to $681,728, and the price of a bungalow increased 11.0 per cent to $490,018. During the same period, the price of a condominium increased 8.9 per cent to $372,638.

While the majority of housing markets in Canada posted modest gains, price appreciation across much of Ontario significantly outpaced the rest of the country. Meanwhile, the pace of year-over-year home price appreciation in Greater Vancouver was noticeably lower than the historic highs witnessed in 2016.

“For the first time in several years, real estate markets in Vancouver and Toronto are headed in opposite directions,” said Phil Soper, President and CEO, Royal LePage.

“The Vancouver market stalled, as confused consumers took to the sidelines after a series of uncoordinated moves by all three levels of government. With its housing shortage becoming more acute, Toronto easily stepped forward to assume the title of Canada’s most overheated real estate market.”

Significant home price appreciation, caused by market dynamics similar to those that have driven housing activity in the Greater Toronto Area, is being seen across the entire “Golden Horseshoe” region of south-central Ontario, and as far away as Windsor and London in southwestern Ontario. In fact, the torrid pace of home price appreciation in much of Ontario contributed almost half of the national aggregate home price increase in the first quarter, with the rest of Canada appreciating by a healthy, but much lower, 6.4 per cent year-over-year when excluding all Ontario-based regions.

“The overall Canadian market is healthier in 2017 than it has been in years, yet the downside risks are greater too,” concluded Soper.

“Our economy, which has recovered nicely from the 2014 oil crisis, is sadly dependent on moves by an unpredictable U.S. federal government and can be swayed by unforeseen global events, such as fallout from Europe’s restructuring. Still, housing activity is strong and prices are rising at a healthy mid-single-digit rate across the land.

The trend in Alberta, Quebec and Atlantic Canada is particularly encouraging. Our concerns with the state of Canadian real estate begin and end in Toronto and Vancouver.” 

Read also: Global News - Saskatoon housing prices flat in Q1 2017: 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.”

Read also: Global News - Increased inventory drives down Saskatoon condo prices

A media release from The Saskatoon Region Association of REALTORS® (SRAR) regarding June 2015 residential real estate sales in Saskatoon and area.

Please note that the association’s comments often touch on “year-to-date” numbers, and some of their comments may address sales within the association’s full trading area. The charts that you see on these posts, as always, reflect data for activity within the city of Saskatoon on a month-to-month basis over the past five years.

The number of active residential listings in the Saskatoon market exceeded the five-year average by nearly 40 percent at the mid-point of the year, and 32 percent higher than a year ago. There are currently 2,081 active listings in a market that has absorbed 340 home sales a month on average for 2015. At that rate, it would take over six months to clear out all available property. "As inventory levels continue to rise against a decrease in sales, I would expect prices to flatten and even decrease for some markets in Saskatoon," warns Jason Yochim, CEO with the Saskatoon Region Association of REALTORS®.

"Most of us would like to see our home values continue to rise however that is not realistic. All markets go through periods of growth and correction." In spite of the probability of a decrease in the average price, some homes are still selling quickly and for full price, or more in many cases. "It is simply a function of proper pricing to current market conditions. If you have to sell, it is highly advisable to obtain credible advice on how the current market is affecting your home specifically," adds Yochim.

In spite of higher levels of homes for sale, the average price has changed very little. This is likely due to a spike in sales between $900,000 and 1,000,000 in 2015 with seven sales versus just two, year-to-date in 2014. Also June over June sales of homes priced between $700,000 and 750,000 increased from two sales last year to seven this year. This underscores the concern with gauging the market based on the average price. An increase in sales within a certain price range can skew the average for a measured period of time.

The best indication of future trends in housing prices is the Home Price Index (HPI). Like the Consumer Price Index, it measures the relative change in home values over a period of time. This is a more accurate measure of value than the average price as the average can be skewed by a change in the number of sales in any specific price range.The HPI price for single-family homes was $329,500 at the end of June, virtually unchanged from a year ago. The single family home value has slowly risen from $325,000 in January which was an 18 month low.

Overall the total number of homes that changed hands was 2,044 year-to-date which is a 14 percent decrease from a year ago. However, the five year average for home sales is only two percent higher than this. By the mid-point in 2013, the total transactional dollar volume for the Saskatoon Region Association of REALTORS® exceeded $1.1 Billion for the first time. So far this year it is slightly down at $960 million which equals that of 2013.

Read also: CTV News - Saskatoon housing market expected to drop

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Norm Fisher Royal LePage Vidorra