TORONTO (Reuters) - Home-price increases moderated in the first quarter, but remained solid due to a strong economy, high immigration levels, and relatively low interest rates, according to a report released on Thursday.
Nationally, the average price of a detached bungalow climbed 8.3 percent to C$336,834 ($333,857) in the first three months of 2008, according to Royal LePage Real Estate Services’ latest House Price Survey.
The price of a standard two-storey homes rose 7.1 percent year-over-year to C$400,647, on average, and a standard condominium increased 6.9 percent to C$240,423.
While those increases were down from the double-digit rises of previous quarters, they still stand in stark contrast to the hobbled U.S. housing market.
A crisis that began in the U.S. subprime mortgage sector has eroded the value of U.S. homes and threatens to push the country into recession.
“We know now that the Canadian real estate market has followed a markedly different path from that of the United States,” said Phil Soper, president and chief executive of Royal LePage.
“While Canada will not escape the negative impact of a troubled American economy, Canadians’ home equity should remain safe, as the market moves into a period of slow growth, but growth nonetheless.”
Looking around the country, Saskatoon and Regina in the province of Saskatchewan had the hottest markets, with average prices for a detached bungalow soaring 50.3 percent to C$226,250 and 49.6 percent to C$158,500 respectively.
“In Saskatchewan, gold, diamond and uranium mining, along with prospering agriculture industries, have retained many would-be out-migrates, and the more moderate cost of living has also lured skilled workers from Alberta,” the report said.
Despite the strong oil and gas economy in the province of Alberta, increases in home prices there have moderated from the frenetic pace of the past few years.
The price for a standard detached bungalow in Edmonton, Alberta, actually fell by 4.9 percent in the quarter to C$330,000.
In Calgary, Alberta, Canada’s oil industry capital, the price for a standard detached bungalow climbed 9.9 percent to C$442,852.
Vancouver, British Columbia, site of the 2010 Winter Olympics, remains Canada’s most expensive real estate market. The price of a standard detached bungalow jumped 11.4 percent to C$852,750.
In Toronto, Canada’s largest city, the price increase was 11.3 percent to C$432,679.
The price increase in Montreal was below the national average, rising 3.9 percent to C$227,799.
The report noted that record snowfall in Central Canada left many city streets and sidewalks almost inaccessible to potential homebuyers during the quarter.
Reporting by John McCrank; Editing by Peter Galloway