Royal LePage Housing Report: first quarter 2008.

Canada’s real estate market stands on stable footing. On average, healthy year-over-year house price gains were recorded during the first three months of 2008.

While more modest price increases were observed when compared to previous quarters, the solid appreciations noted in the first quarter are largely due to the shared effects of resilient local economies, high immigration levels, and relatively low interest rates – all leading to enduring buyer demand, according to a House Price Survey report released today by Royal LePage Real Estate Services.

While almost all markets surveyed experienced price increases, it was the smaller cities, with relatively affordable housing and strong economies based on resource industries that emerged with the most significant gains. Thriving Saskatoon saw appreciation as high as 66 per cent, while areas in Newfoundland posted increases above 20 per cent for the first time since Royal LePage started tracking house prices.

Of the housing types surveyed, detached bungalows increased to $336,834 (+8.3 %), followed by standard two-storey properties, which rose to $400,647 (+7.1%), and standard condominiums, which increased in price to $240,423 (+6.9 %), year-over-year.”

Average house prices increased in Toronto and Montreal during the first quarter, while unit sales activity dipped from the same period last year. While there was a decline in unit sales volumes, the current activity levels in both cities are amongst two of the best first quarters on record for Toronto and Montreal.

It is worth noting that record snowfall in Central Canada and Quebec left many city streets and sidewalks virtually inaccessible to potential homebuyers during the first quarter. As a result, many sellers held off listing their homes, choosing to wait for more conducive weather for open houses and viewings.

Montreal experienced near double-digit gains in average house prices during the first quarter of 2008, driven primarily by continued strong buyer demand and the affordable cost of borrowing money. While the province’s manufacturing sector experienced a troubling first quarter, the robust service sector has been able to offset the impact by absorbing a considerable amount of those who would be without jobs. Montreal’s economy remains relatively strong, and has helped position the province to be among the least affected by housing’s decreasing affordability.

Read the complete report at Royal LePage.ca