Housing-price correction ‘unfounded’

Vancouver will dodge the housing price correction some observers have predicted for this year, real estate brokerage Royal Lepage said in a forecast released Thursday.

Bill Binnie, owner of Royal Lepage North Shore, said the firm expects foreign investment and low interest rates will sustain demand for all types of houses in Vancouver this year.

“While we anticipate some slowing of the market this year, we believe calls for a price correction — particularly in the condo market — are unfounded,” Binnie said.

Price increases in the Vancouver market should slow in 2012, with average prices expected to finish the year 2.3 per cent higher than they were a year earlier, Royal Lepage said.

“The state of the global economy will be a major factor in determining how the Vancouver real estate market fares in 2012,” Binnie said.

Last year in Vancouver, detached bungalows rose 14.1 per cent to an average of $1,017,500, two-storey homes gained 10.9 per cent to $1,117,250 and condos increased 10.7 per cent to $536,500, the brokerage said.

The national housing market will continue to be strong this year, with rising property values expected in all major markets, Royal Lepage said. The forecast called for prices across to country to rise 2.8 per cent by the end of 2012, after stronger gains last year.

It said in the fourth quarter of 2011, the average price of a standard twostorey home was $375,427, up 4.2 per cent from a year earlier. The average rate of a detached bungalow was up 6.1 per cent to $344,392, while condominiums gained 3.6 per cent to $234,680.

“The industry has significant momentum entering the year, and buoyed by the stimulative effect of very low interest rates, we expect the market to continue to expand — albeit at a slower pace,” said Royal Lepage CEO Phil Soper.