Prices of resale homes in Canada rising faster than new homes

MONTREAL  August 10, 2010  - Canadian housing prices are rising faster in the resale home market than on new homes, a report by Scotia Economics said Tuesday.

Over the last decade, the average cost of a new home grew by just over 50 per cent, while the average price of a resale home grew by more than 100 per cent, Scotia's Global Real Estate Trends report said.

The report comes at a time when new data from Statistics Canada and the Canada Mortgage and Housing Corp. reinforce existing forecasts that the real estate market - including new and resale properties - is slowing during the second half of 2010.

In her report, author Adrienne Warren attributed the sizzling Canadian resale market of the 2000s to a combination of factors, including a tight supply of existing homes, combined with strong demand because of a robust economy.
"The two (resale and new) increased in value fairly significantly," said Warren, senior economist with Scotia Economics. "It's just that the resale market grew more substantially."

The gap between resale and new home prices varies across the country, with the greatest divergence in British Columbia.

Quebec followed the national average, Warren said.

Click here to read the full article from the Montreal Gazette

Marlene Ofter

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