Canada’s residential real estate market saw strong but slowing year-over-year price growth in the fourth quarter of 2017, according to a report by Royal LePage.
The real estate company said that based on data in 53 markets, the price of a home in Canada increased 10.8% year-over-year to $626,042 in the quarter.
Broken down by housing type, Royal LePage said the median price of a two-storey home rose 11.1% year-over-year to $741,924, and the median price of a bungalow climbed 7.1% to $522,963.
But the company said in its report released Wednesday that the median price of a condo grew faster than any other housing type studied, rising 14.3% to $420,823 on a year-over-year basis due to gains in many of the largest markets.
In the Greater Toronto Area, the median price of a condo grew 19.5% year-over-year to $476,421, while in the City of Toronto, the cost of a condo rose 19.6% to $515,578.
In Greater Vancouver, condominiums followed a similar pattern during the quarter, rising 20.2% to $651,885, while the median price of a condo unit in the City of Vancouver rose 18.7% to $775,806.
In a separate report that examined luxury home sales, Sotheby’s International Realty said sales in the Greater Toronto Area of homes over $1 million in 2017 slowed in the second half of the year following a move by the Ontario government to cool the market.
Sales of homes over $1 million in the GTA in the second half of the year were down 56% compared with the first six months of 2017 and down 33% compared with the second half of 2016.
However, sales of homes over $1 million in the region for all of 2017 were up 5% compared with 2016 due to the hot start to the year and strong condo sales. Sales of condos over $1 million in Canada’s largest city climbed 59% compared with 2016, while sales of those over $4 million rose 82%.
Sotheby’s CEO Brad Henderson said the condo market’s strength is persisting because there’s a “scarce” number of affordable, family homes in the city and surrounding regions, and increasing numbers of empty-nesters looking to move closer to their kids downtown.
“The condo market will continue to be a strong and resilient class of real estate,” Henderson said.
“It is a much more affordable opportunity, even in the luxury level, and there is considerable demand.”
Calgary saw overall home sales over $1 million increase 11% year-over-year, while sales in the $1 million-plus real estate market increased 20% in Montreal.
Meanwhile, Sotheby’s said sales of homes over $1 million in Vancouver fell 5% compared with 2016, while those over $4 million fell by 33%.
Royal LePage said the GTA showed signs of slowing as 2017 drew to a close, notably in the single-family detached segment.
In the fourth quarter, the median price of a two-storey home and bungalow in Toronto and surrounding area fell by 2.0% and 2.4% respectively on a quarter-over-quarter basis.
The company says condos were the only segment to appreciate on a quarter-over-quarter basis among all housing types, rising 1.1% in the final three months of the year.
At the same time, the price of two-storey homes and bungalows fell 0.3 and 0.2% quarter-over-quarter, respectively.
“To prospective homeowners in our largest cities, condominiums represent the last bastion of affordability,” said Royal LePage president and CEO Phil Soper.
“This is especially true for first-time buyers whose purchasing power has been reduced by tightening mortgage regulations.”