You are here
How to make an easy million in a year: own a West Vancouver home
[OTTAWA] Finance Minister Bill Morneau moved last week to cool Canada's real estate market, but how hot was it?
If you sold a home in West Vancouver after owning it for just one year, you'd have made an easy million dollars, according to a report Thursday from Royal LePage.
The average price in the suburb that stretches from Horseshoe Bay to Ambleside Park jumped to C$3.41 million (S$3.57 million) in the third quarter, from C$2.44 million in the same period a year earlier, the report said.
Soaring prices in Vancouver, as well as in the country's second-hottest market Toronto, have been the subject of warnings for years from officials including Mr Morneau, whose mortgage tightening measures unveiled last week may finally provide a turning point. Data Friday from the Canadian Real Estate Association and a policy report next week from the central bank may shed more light on the matter.
Mr Morneau's new rules were meant to stabilise markets and it would also be a good thing if they made new buyers pause before taking out huge loans they maybe couldn't afford, the finance minister told reporters Thursday. Policy makers have singled out Vancouver and Toronto as the markets most at risk of a correction.
You'd have pocketed an average of C$738,000 from selling a home after a year of ownership in some areas of mid-town Toronto, where prices have increased about 23 per cent, according to Bloomberg calculations on Toronto Real Estate Board data.
Home prices across 53 of the country's largest markets increased 12 per cent to about C$545,000 in the third quarter from a year earlier, according to the Royal LePage report. In Greater Vancouver, prices were up 31 per cent to C$1.19 million. In Greater Toronto they climbed 14 per cent to C$693,000.
High prices, a low inventory of homes for sale and uncertainty over how the recent tougher rules will affect the market should lead to a cooling off, said Phil Soper, chief executive officer at Royal LePage, a unit of Brookfield Real Estate Services Inc.
"Relief appears to be on the way," said Mr Soper.
"For months, the number of homes trading hands has been slowing on eroding affordability. And, slower sales volumes lead to moderating prices."