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Canada's housing market both vigorous and stable
/ A( `) t" J8 U3 E( h5 t& P+ G# I
5 N5 M. N5 P% c3 ?! h" V- Country's market poised to show growth throughout 2006 -
1 A% y2 l% Q8 J, ~2 x
* R( ]; {: G0 S8 c- ?( r, `( B TORONTO, Sept. 28 /CNW/ - For most of Canada, the housing market. L/ @; U* x2 f) b! V1 q! P
exhibited moderate price increases and stable unit sales during the third! N* L3 w% x# Z7 K8 H
quarter. Wide regional variances continued to be the dominant characteristic
9 N1 P _5 @+ N! k, E; oin the market, exemplified by frenzied levels of activity and double digit' Y6 V/ ?+ R$ f3 u3 O0 T
price gains observed in the energy and commodity rich Western provinces, and# Q0 |7 G4 b8 i B0 i9 Y0 B( F
more reasonable sales volumes and moderate price appreciation in Ontario,
# Y0 T1 v" \/ ^* `Quebec and Atlantic Canada, according to a report released today by Royal' o( m9 U2 E0 m0 S+ b8 _
LePage Real Estate Services.
$ Y+ r% f4 O: f/ i; d, m1 a- P0 Y- j+ Q3 H: t6 B& U+ \( y" ~
Nationally, market trends established through the first three quarters1 k( {* ^6 m! ^ W/ T- S5 {) z" W! h% F- n
are forecast to continue for the remainder of the year. Robust economic
1 @5 ?; T+ f# y5 r" uconditions, low unemployment rates, modestly growing salaries and wages, and. o& h, m" `, ]4 W w0 F& B
sound consumer confidence contributed to the overall strength of the
, G6 q% R0 l8 ^residential real estate sector.8 H: }; h/ D) _5 `8 d6 K# s) d
# h" H2 ~: z. G# v" L4 w/ i Of the housing types surveyed, the highest average price appreciation- y K. c6 w+ I6 ~
occurred in detached bungalows, which rose to $300,365 (+16.3%)
* F0 }8 s( }# q% Lyear-over-year, followed by standard condominiums, which rose to $211,562% Q6 N- B4 e0 ^' P* o
(+14.2%), and standard two-storey properties, which increased to $365,380
3 G" q* x% N2 P- P(+13.2%).% R6 T. u+ g& B* `% @7 i+ n6 J
$ J8 [ I* d$ O% r& O+ W "Canada's sturdy housing market continued to demonstrate steady growth
7 C' S. e6 H s9 b. |5 N5 U/ oduring the third quarter. For all but the west, we have moved on from the
( T1 G' A) C0 [frenzied expansion that characterized the first half of this decade, and are
) \: R6 g2 {, a" D$ s' W6 \poised to show continued growth at a more moderate pace," said Phil Soper,
( w/ a. X: z! W Fpresident and chief executive officer, Royal LePage Real Estate Services.0 q. V; _6 }% P1 ^2 l
"Gone is the sellers' market that we have lived with for some years. We
2 c9 M& N6 E0 f" l; r, gwelcome the more reliable conditions that are characteristic of a healthy
" S" @+ s6 p- r0 g1 \7 k* e0 lbalanced market."/ i; A0 H& `: u1 j9 c+ F5 f2 p! K
* w5 r* G. w% J Despite the double-digit rise in average national house prices,
! c/ @+ ?: @# Aconsiderable regional variances were exhibited again this quarter. The shift
; k- g) r; ] t/ Z2 cto balanced market conditions, which began in late 2005, has continued
9 T* U& j& ~" g7 ] R% M e$ Uthroughout most of the Central and Eastern regions of the country. In the core0 K. O" E: k8 h0 j: I0 Q
energy producing western provinces, the combination of very high in-migration,& K6 m# @0 H' I! D6 k, J1 A7 I( B
manageable affordability, and a shortage of inventory has driven record4 W- n+ `( o$ k# g
breaking price appreciations." {* J6 j0 I1 C5 y6 n/ W) s* ` y
. s/ j$ }$ t- Q: l/ s( u# C* O Echoing the second quarter and supported by Alberta's rapidly expanding4 Z1 B ^" u9 ]1 r- Y, E
economy, Calgary and Edmonton led the charge of Canadian cities with the
1 q ]9 ?/ z% r8 ]. y3 slargest house price appreciation in all housing types surveyed.
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In Ottawa and Toronto, growth remained steady, supported by solid
% k0 D6 \8 P G/ K4 j0 Aeconomic fundamentals, an increase in available inventory and strong consumer
: ~, O2 y! d$ O( K8 `2 Y& q( Zconfidence. While the pace of price appreciation in Ontario leveled off7 k C* H5 Z1 R$ m; G# v
slightly, the province's real estate market remains poised for modest growth.* e, u h* d2 [. h) \3 P
In Atlantic Canada, new housing and condominium construction offered buyers. G8 |5 q' [" ?9 O D* C
greater selection at more competitive prices, resulting in a slower rate of
- L! k1 C' y7 l5 a0 bprice appreciation when compared with 2005.) ]$ |- A2 u# |. u6 J) L! T
* c% q) |% V2 p. z% z9 a% S( ?6 U While the pace of growth in Canada has slowed, the domestic housing
: A0 g3 X5 k; p5 {( b, Q5 rmarket is expected to outperform the American market. The economic and1 D9 y& x: _/ s
financial fundamentals driving the residential real estate sector in Canada5 N/ D6 Y1 _' V$ ^3 d; B
are markedly different than those found in the United States.& [4 A' l9 K% Y8 P3 g+ Y
. H: a. p: I$ d3 ^: g3 S' ] C8 U0 N Added Soper: "Canada's housing market is likely to outperform the. u; ] V/ e O2 c1 ^
American market through 2007. A number of factors are working in Canada's
) J- X) h8 U" B3 efavour, including healthy personal and governmental debt levels, the
: L& x5 s# }$ j, G5 w. urelatively modest rise in interest rates in our country, and general
% X' s" v6 h, x7 [0 v6 x- Saffordability in our major cities. In addition, Americans are now seeing the
b' u7 s3 e$ u9 b0 p; h3 H( kdownside of a tax system that encourages maximum homeowner leverage, and
4 R! W: P( J9 W! {aggressive financial products such as zero- and negative-amortization
" D) ?( q; ^3 p+ T: Q5 w2 P) t- emortgages that work only in a high price growth environment.": [! C3 J" `2 [- i
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<<
3 t& x' C, F+ c8 A1 } L* d REGIONAL SUMMARIES+ q2 A _+ |: f7 H
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Balanced conditions continued to characterize the housing market in
5 z9 Y6 B) z& pHalifax, as significantly higher inventory levels helped to moderate the rate
3 w- g! u7 E9 N7 r$ {of price appreciation. Buyers were increasingly choosy, taking more time
" F8 G( [8 M' u: \+ l! u; ?2 |looking for newer, low-maintenance properties that were not in need of
: |' w) k: \2 ^ \renovations.
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The housing market in Moncton remained healthy and strong as a slight
2 b( ]' A9 i3 fincrease in inventory helped to moderate the rate of price appreciation
& c4 n/ j, j1 z9 I' Z, u7 y3 s" `compared to the same period in 2005. Activity was brisk throughout August and
. [# K0 p. M: W6 iSeptember and is expected to remain this way through the fourth quarter.
) L; |# S) I% O3 H; W4 @
- }9 F l5 q8 F8 @- N1 m The housing market in Saint John underwent its traditional summer
- w( a2 n( h3 p& X+ M# o: ^slowdown in the third quarter, with activity picking up towards the end of the' m. ~6 i B1 k' K* h, |0 G! d; t
quarter. The local economy continued to thrive, as construction on a new+ l" r8 A4 ]- Q# ?- d! ^
600,000 square-foot shopping area has begun, bringing several new box stores
& o# T2 T+ [8 j5 s1 K) Kto the area. Buyers have begun seeking less expensive fixtures for their homes, l/ J F4 u4 G- }
and are instead opting for more affordable housing options.
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In Charlottetown, the housing market started to move towards balanced6 R: h& S0 u1 H8 W7 A5 m& X
conditions, as some sellers had to begin to lower the asking prices on their
( O* w1 `# d$ ^! b9 P y- L; W6 ohomes to make them more competitive. Activity from out-of-town and US buyers) a2 Z1 z/ F6 y. u
was down slightly compared to 2005, likely attributable to the strong Canadian
F/ X1 J/ _8 q) m7 a* Ydollar. Inventory levels began to creep up in the third quarter, providing
- D3 k8 p7 _2 R M$ Nbuyers with more options when looking for a home.
$ \8 v) A+ \0 {/ n( P) l ^+ q8 m X, X( ?6 w
Activity in St. John's slowed slightly in the third quarter, particularly8 d) x8 O+ j! R" h) V
among higher-priced properties, where there was a slight over-supply of homes8 U2 s5 y$ h" k1 @
priced over $200,000. Listing periods have increased when compared with 2005,
; g3 @' m1 A0 s5 m, n# @" ]as some of the pent-up demand that had characterized the market over the last9 Q8 K! J6 q/ s& z% z8 _+ X0 y w
few years has been satisfied, resulting in more normal, balanced conditions.
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Montreal's housing market recorded modest increases in average house5 I/ o, l% F8 n$ t; d
prices, due to a slight seasonal slowdown in the third quarter as inventory3 k9 y( d0 F1 \! n4 t+ \- |% X, N
levels rose. Part of this can be attributed to the fact that many renting. j2 W8 D+ x6 r1 M' x i
first-time buyers were motivated to close on the purchase of a home by July 1,
1 T4 s' {; W' D# Awhen rental leases expire in Quebec. Once this date has passed some of the p3 R" E: n+ b! ]# b. w& t# H1 r+ W
pressure is taken off the market, allowing buyers to visit more homes before* q; F( ^! E; y& x; g' ~
making a purchase.
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Ottawa held its position as one of the country's most stable housing- d+ |+ i6 y5 p/ X# ]) F
markets in the third quarter, reinforced by a vibrant local economy and strong t/ m2 n6 p! b2 |8 a& W$ t
confidence, resulting in modest increases in average house prices. The city& w% I% `4 ]6 _3 ]& ]- F) L8 t9 N
centre remained a bright spot in Ottawa, with homes in this area attracting: D+ L5 t4 U' z
attention due to their convenient location and proximity to downtown4 N' M4 t: N& j' c }, i5 M
amenities." q* }( G' U9 }( K- \6 p
/ f; K2 @( @' x: r# v- r7 [# } The housing market in Toronto sustained healthy activity levels
% V4 p: X7 ~# ^& ~( N; O. N% N3 Zthroughout the third quarter, as a strong economy helped to maintain demand$ }; Y' ?5 o. H& t! @
across the city, causing average house prices to rise moderately. Toronto has
. m4 I2 }) i! C1 Vcontinued to experience modest growth in average house prices, and has been% _- {% I/ b9 U) G# y
driven primarily by purchasers who are buying homes as their principle
# g% g6 |0 s1 p+ v: x7 Eresidence, rather than for investment.9 \" H) H/ J5 M* x) O/ V
; C3 J5 Z, b; f) z
The vibrant Winnipeg housing market continued to show its strength as
# R! J4 J$ ]4 {4 Q h+ x- Khouse prices rose during the third quarter. The booming local economy resulted
! i0 V( U% K' ?: Yin a historically low unemployment rate, helping to bolster consumer
4 E' p3 O) k( \& o- |' D t6 Zconfidence and Winnipeg's ranking as the city with the lowest capitalization! p* @) T' g# a& J* `
rate among the country's larger cities - helped to encourage buyers to enter$ ]$ d9 M- e2 T4 P; w, V5 Z
the market.4 l- V5 l- m) \2 L% s6 r. m
& F" o& h7 r/ {4 U* I7 O+ F
In Regina, the market experienced a slight seasonal slowdown through
?! T/ T H, h2 K4 V( W UJuly, as there were fewer purchasers in the market due to summer vacations. In
0 C) H/ U2 p/ H4 v8 UAugust, activity resumed to the busy pace previously seen in the spring
% R0 `& N3 S3 }' dmonths, as the influx of purchasers made it more difficult to find a home due
1 ?3 d- T7 l0 l4 y* Z8 xto the shortage of available inventory.
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Activity in Saskatoon remained brisk as the market maintained its( T/ X' u1 C, P5 R5 y, ^
momentum from the busy spring sales period. The economy in Saskatoon remains
, {' f1 c3 N" D; B, k) ?vibrant, as employment opportunities are abundant with many businesses9 J8 j" }& Y0 S1 X
struggling to make hires and having to recruit outside the province.# g- X# n3 v, K/ i8 U/ S( N
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Calgary's housing market recorded blazing average house price increases
! G0 T/ a1 d, x8 }3 b( Hin the third quarter, in all surveyed categories. The burgeoning economy, low! Z# t4 D; F& B2 K
unemployment rates and low inventory levels remained the leading factors that
, Q6 }& @ I3 Y5 Cpressured Calgary's house prices upwards. However, regardless of the soaring
( {7 e& L5 s$ fprices that characterized the market - even during the typically slower summer
; J# c3 u4 B" W' L3 ^4 R* iseason - it is expected that activity will become slightly more balanced, as k X. G4 K3 ]: d y" [# s
buyers are becoming more reluctant to participate in the frenetic activity.
/ S2 h- i) I( @. u& Z }; M
& M. @9 u ~8 { Edmonton's booming local economy continued to thrive in the third quarter3 ?0 R: N9 r$ l% I
as activity in the oil sands north of the city continued to flourish. Edmonton' ~1 W% G( [4 ?/ k+ t
remained the hub of activity for those coming to work in the oil industry,
5 B @+ H R3 D0 q% i. K7 Lmaintaining tight inventory levels across the city, resulting in prices
1 ]' t2 e6 V1 I2 z. I) _increasing at record levels. However, as inventory levels continued to improve
8 i( J0 `! J$ s3 r+ Sin the third quarter the rate of price appreciation should moderate slightly
5 O3 d8 F0 U% T+ y# D- Ttowards the end of 2006.
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3 x O8 p" x) q( C% ^6 K6 XWhile Vancouver has seen a slight reprieve from the severe shortage of2 X: O V% x- N. b5 l/ }) D
inventory that had previously characterized the market, supply is still unable2 F7 f, T0 X+ Z& D- p% A
to meet demand, driving house prices upwards. Vancouver has a very diverse. W5 M8 E# ]! x- H' C8 D
group of active buyers - from first-time home buyers to baby-boomers to
1 X6 q) x1 y0 _4 V0 dforeign investors - all of whom fuel the demand for houses, placing added
1 `# ^! g8 o/ ~( T/ t1 Cpressure on tight inventory levels.
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Victoria's market is vibrant and supported by strong economic( R0 c+ N- R7 p# u* ~1 ?( D/ K
fundamentals, fuelled by a booming tech sector and a migration of young people9 D# G! z/ M0 L+ ~
into the city that has continued to support the area's house price increases;
; K5 C% g5 w* b5 @while increased inventory levels have afforded buyers more time when searching4 L/ x/ E! c. n
for a home, helping to normalize the market's pace.' Q# m( O$ T* C$ r3 h# K3 m7 O. p& y
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<<6 ^( t- g2 _: i1 l! Z2 H
Survey of Canadian Average House Prices in the Third Quarter 2006
5 k0 s- Y( g, |8 v8 b2 X) @, t4 j7 b% R" N; t% b
-------------------------------------------------------------------------
5 e) D+ \% {3 i" I Detached Bungalows Standard Two Storey
, g! z2 }9 T% M5 _$ T+ H6 Y8 [2 c -------------------------------------------------------------------------3 B6 u* F$ p0 Q2 N8 v! }7 s
2006 Q3 2005 Q3 Bungalow 2006 Q3 2005 Q3
7 L% u% @2 g8 k/ { Market Average Average % Change Average Average
( j9 L0 N+ u; `5 p! Y8 D/ [ -------------------------------------------------------------------------6 x" J% R! H/ X7 r! }+ C: N) f! C
Halifax 186,333 173,333 7.5% 198,667 199,000
7 v3 L, |4 l5 g7 C& A -------------------------------------------------------------------------
- {3 T% P5 Q6 U) a- R1 d- _ Charlottetown 145,000 141,000 2.8% 175,000 170,000
9 Z% o" P8 {' ^# I! v( f. K$ v) x -------------------------------------------------------------------------4 I0 Z: j" x* l* T2 U, q9 t
Moncton 135,000 127,000 6.3% 129,000 123,0004 s p8 g4 E/ B4 x
-------------------------------------------------------------------------
) M9 B& g5 W I( m* o# X: F( t; b7 n Saint John 141,200 142,900 -1.2% - -
6 t' t7 `% a5 X1 Q3 j -------------------------------------------------------------------------
. C1 A# P9 l* z7 C St. John's 143,667 142,667 0.7% 200,667 202,333% f6 A0 @8 q- ^5 |9 j) G+ }) E2 t* `
-------------------------------------------------------------------------6 }1 Q8 R6 z$ H. D( u, w4 Q! O; U
Atlantic 150,240 145,380 3.3% 175,833 173,583
; H3 p# w0 B& e -------------------------------------------------------------------------
3 I2 B0 G! g3 J Montreal 213,691 203,500 5.0% 321,141 316,185
* D2 j' v2 d0 y! K5 l -------------------------------------------------------------------------5 `4 Y7 O8 L! ~8 R
Ottawa 290,083 278,417 4.2% 285,667 273,250
' C5 @3 F/ ?% U6 k5 B9 k -------------------------------------------------------------------------
5 Q8 M5 q @9 Z9 A Toronto 373,368 355,882 4.9% 481,523 474,766% f1 x0 p4 B+ `$ c
-------------------------------------------------------------------------7 B$ b) ?% j1 K" x& o
Winnipeg 181,579 159,860 13.6% 202,337 180,707
) B' Y" E# Q* Z, y! y -------------------------------------------------------------------------5 @) O+ {' }" g8 P. R
Saskatchewan 170,667 156,083 9.3% 182,600 166,500* \. U# R- f) t
-------------------------------------------------------------------------
6 O/ ]$ m |; c. F Calgary 395,067 252,411 56.5% 405,778 264,389
9 z# s8 r$ @5 a -------------------------------------------------------------------------$ |, Q' u# T( Z
Edmonton 286,857 194,857 47.2% 316,429 206,714: U2 J$ k$ E' A J; `
-------------------------------------------------------------------------
0 ?) k; }+ N; O Vancouver 704,250 601,000 17.2% 794,000 697,5009 M( g8 A. L5 `
-------------------------------------------------------------------------/ s/ o- W0 A5 X, m w
Victoria 375,000 348,000 7.8% 403,000 391,000& R* K. n) k- P. g+ ]1 j; |) A7 R1 h
-------------------------------------------------------------------------: k) m: n9 z. Z# V% n l' ?1 o8 ~
National 300,365 258,202 16.3% 365,380 322,860" K* s- ^+ E) }
-------------------------------------------------------------------------
8 g. Q7 s+ q6 X1 ]4 L
6 b' c$ P- A5 w/ A- Q. ^* N+ s7 ? -------------------------------------------------------------. P# L3 Q9 _ C$ ^
Standard Condominium
$ _: D6 @1 `2 Q+ A: M+ f -------------------------------------------------------------
4 p) i! g8 E \# Q 2-Storey 2006 Q3 2005 Q3 Condo
8 F0 K8 I; a' F2 ? Market % Change Average Average % Change
6 u1 m0 w* c2 g' u; x+ x: i -------------------------------------------------------------2 L! x& e% H$ c+ l6 h b) B7 C! m
Halifax -0.2% 142,000 103,000 37.9%
0 f. |* T8 L+ q) z, J2 | -------------------------------------------------------------+ T9 Z) I5 m' G/ `
Charlottetown 2.9% 98,000 98,000 0.0%
) i% l# x; e6 i, E0 K8 r -------------------------------------------------------------" w% O7 N0 s$ j. |7 k) n& }& g
Moncton 4.9% - - N/A K/ H) F* l& Q
-------------------------------------------------------------+ a3 {0 o. F0 C k! U/ N8 }3 u0 x
Saint John N/A - - N/A
1 M( b$ t! E9 E1 ^! c3 h -------------------------------------------------------------
+ M/ c' }/ I1 Q+ Q9 |5 ` St. John's -0.8% 146,333 145,667 0.5%; m# X: _$ Z; m
-------------------------------------------------------------
7 h% q5 l6 F& ~) V Atlantic 1.3% 128,778 115,556 11.4%
4 b; r# r8 ?- @! {# B& v -------------------------------------------------------------
# B5 i0 a! r5 l7 ^0 H4 @ Montreal 1.6% 193,190 188,016 2.8%! @- w1 v) Z3 o0 \/ ~7 H
-------------------------------------------------------------7 Z* ]$ j+ t5 q$ f& e0 H$ g- `. y
Ottawa 4.5% 181,083 172,250 5.1%4 }' ~9 H. } Y5 Y5 B% r: x
-------------------------------------------------------------' g/ o" `1 V9 G2 T* Q) i
Toronto 1.4% 252,088 242,918 3.8%5 I$ P) B' }! {' v6 i
-------------------------------------------------------------
4 W- O m+ ]6 D5 W: l1 U Winnipeg 12.0% 105,648 96,008 10.0%
2 i( d$ k- L" l' b -------------------------------------------------------------
( K2 x1 f0 \% P3 ?% J# L2 a Saskatchewan 9.7% 106,250 101,000 5.2%
0 @2 Q' x2 L$ x3 L {( L -------------------------------------------------------------* |( w+ R* Z2 L, V
Calgary 53.5% 245,844 153,867 59.8%
" w, p% Z' E6 q -------------------------------------------------------------0 C+ J" ?3 C8 q5 b Z
Edmonton 53.1% 200,433 131,500 52.4%
* ^4 ]# K7 P; M2 o w: a5 @ -------------------------------------------------------------
/ D+ a9 c0 W# o) e$ r8 o& P Vancouver 13.8% 366,250 323,250 13.3%6 O5 A+ N9 E6 O$ w) R3 n
-------------------------------------------------------------4 [ ^! n( k) P2 R
Victoria 3.1% 229,000 220,000 4.1%
2 z/ b" t6 P. q4 J& i& k -------------------------------------------------------------
* {. y! n S9 v1 c- O' s) { National 13.2% 211,562 185,296 14.2%& l9 u1 e" y' n- W: G
-------------------------------------------------------------& K- d% X% d' \ w
>># N9 P' F9 s" h6 Q
& d$ X* G- L& ^. x Average house prices are based on an average of all sub-markets examined8 h5 u' ]1 ^1 u" K; a& K8 g
in the area, except for the smaller markets of Charlottetown, Moncton, Saint2 {& u* F. \ e! [! ^6 `
John and Victoria.
8 Q4 R( f% d! S, ^: v, q$ {+ m, o0 K
The Royal LePage Survey of Canadian House Prices is the largest, most8 r; k+ L6 f9 I6 U" x# }
comprehensive study of its kind in Canada, with information on seven types of0 K( O2 [ x: x! n P
housing in over 250 neighbourhoods from coast to coast. This release1 U" t2 ~/ u0 V& I, c$ {
references an abbreviated version of the survey, which highlights house price
, W2 ~, y& }6 t4 N& P* ktrends for the three most common types of housing in Canada in 80 communities
% o( E9 D( C( G. L Yacross the country. A complete database of past and present surveys is& E- Q% W: O; P
available on the Royal LePage Web site at www.royallepage.ca, and current1 W0 y+ r. B8 d7 N9 ~6 P7 u. K% d
figures will be updated following the end of the third quarter. A printable
/ P6 }0 B; M4 O& Z' a; [version of the third quarter 2006 survey will be available online on$ y! y8 K2 J/ C% r6 h/ t
November 15, 2006./ B6 Q2 r( X% ]1 ^' {% D7 A4 F
Housing values in the Royal LePage Survey are Royal LePage opinions of
* U* r' @( }# k- j' D+ u3 m9 S; _fair market value in each location, based on local data and market knowledge/ a2 X- B; E5 K* j: Q
provided by Royal LePage residential real estate experts. Historical data is
' h% Z) f1 [2 S0 [+ s D8 Cavailable for some areas back to the early 1970s. |
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