House prices in Saskatoon continued to hold larger than expected year-over-year gains, according to the Royal LePage House Price Survey and Market Survey Forecast released today.
Detached bungalows led the way with price gains of 6.7 per cent over the same time last year, selling for a fourth-quarter average of $331,250. Standard condominiums showed year-over-year price gains of 6.2 per cent, selling for a fourth quarter average of $230,000. Standard two-storey homes followed close behind with an overall increase of 6.1 per cent, selling for an average price of $359,250. Some of the gains are attributable to sales of higher quality units in each category, which often occurs when the selection of homes increases as it did in 2010.
“In terms of unit sales, the market is performing as earlier predicted for many regions in Canada,” says Norm Fisher, Royal LePage Saskatoon Real Estate. “A strong first half of 2010 and a weaker second half – Saskatoon was no exception to these forecasts.”
Conditions improved through the fourth quarter as unit sales started to pick up again following a significant decline in the third quarter but multiple offers in the fourth quarter were very rare and homes typically sold for below asking price. Condo sales are down roughly 25 per cent while inventories are up 35 per cent over last year. Properties under $300,000 represent the most sensitive segment of the market as they are most impacted by changing affordability levels. Buyers at that end of the market are definitely holding back. While the Saskatoon market closed 2010 with seven percent fewer residential sale compared to the previous year, unit sales in categories at or below $300,000 declined by eighteen percent. Sales in price ranges above $300,000 gained fourteen percent through 2010.
“We noticed this trend a few months ago,” added Fisher. “Entry level price categories are showing some weakness in unit sales while the higher end is strengthening.”
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.
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