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A national survey is forecasting rising Vancouver house prices into 2011 following a general rise late last 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.” 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 this month. 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. Eighty per cent of downtown Vancouver 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 houses. 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. Realtors add 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. 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. 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.
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