A RE/MAX report on Canadian markets found that the average home price in that country increased 264 percent in a 25-year span, or 11 percent per year.
Nationally, the compounded annual rate of return was 5.3 percent, the compounded annual return of Barrie is 6.4 percent, and the top seven markets in the country realized an annual compounded rate of return ranging from 5 percent to 6.4 percent while the worst-performing market had a 3.6 percent rate of return, RE/MAX reported.
The average home price in 2006 was about $234,300 (in U.S. dollars at the latest exchange rate). In Barrie, Ontario, the average home price increased 372 percent from 1981-2006, according to the RE/MAX report.
Other markets with high price appreciation during that 25-year period include St. Catharines at 329 percent, Hamilton-Burlington at 325 percent, Ottawa at 297 percent, Greater Toronto Area at 290 percent, the Greater Vancouver Area and Halifax-Dartmouth at 242 percent, Victoria at 229 percent, London at 228 percent, Calgary at 227 percent, and Kelowna at 211 percent.
“The results are nothing short of remarkable, given the economic volatility of the marketplace in the past 25-year period,” said Elton Ash, regional executive vice president for RE/MAX of Western Canada, in a statement. “This is especially true in recent years when serious external factors such as 9-11, SARS, and an outbreak of forest fires barely registered on housing activity. Any one of these disasters would have had a significant impact on real estate markets in the 1980s.”
The report cites Canada’s rising population as a major contributor to the growth in house values. The nation’s population increased 25 percent, from 24.8 million in 1981 to a projected 31 million in 2005.
Michael Polzler, executive vice president and regional director, for RE/MAX Ontario-Atlantic Canada, said in a statement, “In the top 10 markets, real estate values rose at least 8 percent or more on an annual basis. Even the worst-performing market in the country experienced an increase of close to 6 percent annually since 1981.”
“Immigration has also bolstered residential home sales, particularly in Canada’s largest cities,” says Polzler. “Approximately 250,000 new Canadians arrive annually and we know from experience that many will buy a home within five years of immigrating. Job opportunities have also prompted in-migration across the country as purchasers from more rural communities seek employment in major metropolitan areas.”
There are about 16,900 RE/MAX sales associates in Canada, and 630 RE/MAX offices.