A survey released Thursday by Royal LePage says high consumer confidence coupled with low interest rates helped drive St. John’s-area housing prices up in 2011.
The report says the average price for a detached bungalow increased 7.8 per cent to $257,333. For a two-storey house the average price rose 4.8 per cent to $343,500, and for condos it went up 4.9 per cent to $268,000. Those figures, however, don’t represent the average price of all sales in the area; rather, Royal LePage determines fair market value for the different types of dwellings in different regions — the St. John’s area has been divided into the west, the east end and Mount Pearl — and averages the prices in each category.
Royal LePage estimated the price of the three types of houses in all three regions rose between 4.5 and five per cent, with the exception of detached bungalows in the east end; Royal LePage says a representative bungalow in the east end rose 14 per cent over last year.
In a statement released by Royal LePage, Phil Soper, Royal LePage’s president of real estate services, said his company expects slower price growth — 2.8 per cent nationally — by the end of 2012.
“In the recovery period following the 2008-2009 recession, I found myself repeatedly speaking of ‘irrational exuberance’ in the Canadian housing market,” said Soper in the statement. “Expectations were too high and the pace of expansion unsustainable. With this report, I find myself in exactly the opposite position. Widespread calls for a major real estate correction in 2012 simply can’t be justified. The industry has significant momentum entering the year, and is buoyed by the stimulative effect of very low interest rates; we expect the market to continue to expand — albeit at a slower pace.”