Increases fuelled by low interest rates, shortage of inventory
The Royal LePage House Price Survey released today shows a strong St. John's real estate market with average prices for condominiums up by 13.3 per cent to $230,000, bungalows increased by 13.1 per cent to $215,000 and standard two-story homes increased by 13.3 per cent to $296,667 when compared to year-over-year.
This quarter, the Mount Pearl area witnessed the largest price increases as bungalows were up 17.8 per cent to $235,000, while two-storey homes were up 16 per cent to $290,000.
First-time buyers and real estate investors continued to drive the market taking advantage of increased affordability due to low interest rates.
A lack of inventory at all price points meant that while unit sales were down, prices were up compared to Q2 with many properties attracting multiple offers.
Glenn Larkin, Broker/Owner, Royal LePage Atlantic Homestead Ltd., cautions that the city is not entering another aggressive expansionary real estate cycle.
"Where there is a shortage of homes for sale, we are seeing stronger activity," Larkin said. "Where there is no shortage, we're seeing normal bidding take place without the 'panic buying' we witnessed last year."
In contrast to the national trend, which saw buyers for lower-priced homes drive the market, mid- to high-end buyers in St. John's also returned to the market in Q3 causing some of the city's largest price increases.