Real estate brokerage Royal LePage cuts price forecast for 2022

TORONTO — Royal LePage is cutting expectations for home price growth this year after saying prices in the second quarter fell from the first three months of the year.

TORONTO — Royal LePage is cutting expectations for home price growth this year after saying prices in the second quarter fell from the first three months of the year.

The real estate brokerage firm says it now expects the overall price of a home in Canada in the fourth quarter of this year to be up 5.0% from the same quarter in 2021.

The forecast is down from an April estimate of a 15.0% year-over-year increase for the fourth quarter.

He says he lowered his forecast following more aggressive-than-expected interest rate hikes by the Bank of Canada, leading to an expected temporary drop in demand in parts of southern Ontario and British Columbia.

In its Home Price Survey, Royal LePage reports that the overall price of a home in Canada in the second quarter was $815,000, up 12.1% from a year ago. However, it was down 4.9% from its record high in the first quarter of this year.

Royal LePage says it was the first quarter in more than three years to post a quarter-over-quarter decline in home prices.

“Some of the heat that had been driving the market cooled in the quarter as rising interest rates coupled with economic uncertainty undermined consumer confidence and pushed buyers away,” he said. Royal LePage CEO Phil Soper said in a statement.

“We have significantly reduced our outlook for 2022, but house prices are still expected to end the year above 2021 and well above pre-pandemic norms.”

This report from The Canadian Press was first published on July 13, 2022.

The Canadian Press