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Housing prices should remain stable across Canada despite COVID-19 pandemic: market forecast

MONTREAL -- The price of a house in Canada is expected to remain stable despite the COVID-19 pandemic, according to a market survey forecast released on Tuesday.

The best-case scenario -- which hinges on stay-at-home restrictions easing in the coming weeks -- would see home prices grow a modest 1 per cent by the end of the year, according to the Royal LePage House Price Survey and Market Survey Forecast. The aggregate value of a Canadian home would come to $653,800.

If heavy restrictions are still in place through late summer, home prices are expected to decrease by 3 per cent across Canada by the end of 2020, bringing the aggregate value to $627,900.

The aggregate price of a home in Canada climbed 4.4 per cent year-over-year in the first quarter of 2020. In December 2019, Royal LePage had forecast an increase of 3.2 per cent by the end of 2020, but that expected growth had to be revised due to the COVID-19 pandemic.

"From our experience with past recessions and real estate downturns, we are not expecting significant year-over-year price changes in 2020,” said Royal LePage president and CEO Phil Soper, adding, though, that stay-at-home mandates through the summer would leave many people temporarily out of work with more permanent job losses, placing “downward pressure on both home sales volumes and prices.”

There was a sharp decline in real-estate activity in the last four or five weeks, the survey showed. Home searches on real estate websites dropped more than 20 per cent, home showings dropped by more than two-thirds, and open houses have been reduced to almost zero nationwide. Soper said realtors are using virtual home showings and restricting in-person interaction with clients in the meantime.

FIRST-QUARTER 2020 HOME VALUES:

  • Aggregate home price: $655,276
  • Two-storey home: $770,005 (up 5.1 per cent year-over-year)
  • Bungalow: $541,040 (up 2.1 per cent)
  • Condominium: $493,917 (up 4.4 per cent)

REGIONAL BREAKDOWN:

GREATER TORONTO AREA

  • Aggregate home price in the first quarter of 2020: $866,211 (up 7.5 per cent year-over-year)
  • Two-storey home: $1,010,004 (up 7.7 per cent)
  • Bungalow: $826,186 (up 3.7 per cent)
  • Condo: $580,508 (up 8.8 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $861,100 (up 1.5 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $844,200 (down 0.5 per cent year-over-year) by the end of 2020.

GREATER MONTREAL AREA

  • Aggregate home price in the first quarter of 2020: $441,979 (up 7.2 per cent year-over-year)
  • Two-storey home: $557,594 (up 8 per cent)
  • Bungalow: $344,043 (up 6.9 per cent)
  • Condo: $344,962 (up 5 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $434,500 (down 0.5 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $421,400 (down 3.5 per cent year-over-year) by the end of 2020.

This forecast factors in that Quebec is the only province where real estate brokerage is currently not included in the list of essential services, Royal Lepage noted.

GREATER VANCOUVER AREA

  • Aggregate home price in the first quarter of 2020: $1,083,166 (down 2.1 per cent year-over-year)
  • Two-storey home: $1,402,395 (down 1.1 per cent)
  • Bungalow: $1,182,420 (down 4.2 per cent)
  • Condo: $636,012 (down 2.5 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $1,086,800 (up 0.5 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $1,054,400 (down 2.5 per cent year-over-year) by the end of 2020.

OTTAWA

  • Aggregate home price in the first quarter of 2020: $502,808 (up 8 per cent year-over-year)
  • Two-storey home: $526,584 (up 6.9 per cent)
  • Bungalow: $519,827 (up 12 per cent)
  • Condo: $343,998 (up 8.1 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $506,500 (up 2.5 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to remain flat, year-over-year, at $494,100 by the end of 2020.

CALGARY

  • Aggregate home price in the first quarter of 2020: $469,156 (down 0.1 per cent year-over-year)
  • Two-storey home: $514,713 (up 0.9 per cent)
  • Bungalow: $485,984 (flat)
  • Condo: $261,778 (down 7.2 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $463,000 (down 0.5 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $451,300 (down 4 per cent year-over-year) by the end of 2020.

EDMONTON

  • Aggregate home price in the first quarter of 2020: $371,118 (down 1.4 per cent year-over-year)
  • Two-storey home: $430,732 (up 1.5 per cent)
  • Bungalow: $351,481 (down 6.3 per cent)
  • Condo: $215,223 (down 5.3 per cent)

If business resumes by the end of June, the aggregate home price is expected to reach $370,800 (down 1 per cent year-over-year) by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $363,300 (down 3 per cent year-over-year) by the end of 2020.

HALIFAX

  • Aggregate home price in the first quarter of 2020: $317,064 (down 1.8 per cent year-over-year)
  • Two-storey home: $338,057 (down 0.8 per cent)
  • Bungalow: $266,593 (down 1.7 per cent)
  • Condo: $284,039 (down 13.4 per cent)

If business resumes by the end of June, the aggregate home price is expected to remain flat at $316,600, year-over-year, by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $313,400 (down 1 per cent year-over-year) by the end of 2020.

WINNIPEG

  • Aggregate home price in the first quarter of 2020: $303,523 (up 1.8 per cent year-over-year)
  • Two-storey home: $326,627 (up 1.3 per cent)
  • Bungalow: $292,532 (up 2.3 per cent)
  • Condo: $241,048 (up 2.3 per cent)

If business resumes by the end of June, the aggregate home price is expected to remain flat, year-over-year, at $310,900 by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $304,700 (down 2 per cent year-over-year) by the end of 2020.

REGINA

  • Aggregate home price in the first quarter of 2020: $317,400 (down 2.1 per cent year-over-year)
  • Two-storey home: $399,564 (up 4.8 per cent)
  • Bungalow: $284,033 (down 6.5 per cent)
  • Condo: $194,470 (up 12.9 per cent)

If business resumes by the end of June, the aggregate home price is expected to expected to reach $311,000 (down 2 per cent year-over-year), by the end of 2020.

If business activity resumes in late summer 2020, the aggregate home price is expected to reach $304,700 (down 4 per cent year-over-year) by the end of 2020.