Average house prices increase in Saskatoon, but flat in Regina.

Farm economy hinders consumer confidence in Regina

Saskatoon's real estate market reported increased demand during the summer, which put upward pressure on house prices, causing marginal increases in most areas examined, according to a third quarter 2001 report released recently by Royal LePage Real Estate Services Ltd., a wholly owned subsidiary of Trilon Financial Corporation. However, home sales activity and average house prices in Regina remained flat year-over-year.

Based on the Saskatoon markets examined, the average price of a detached bungalow marginally increased to $130,250 (up 2.2 per cent), a standard two-storey home rose to $146,000 (up 2.6 per cent), and a standard condominium edged up to $88,750 (up 1.4 per cent) year-over-year.

The strong local economy sustained a steady stream of sales activity during the summer in Saskatoon. Inventory marginally increased in third quarter 2001 compared to third quarter 2000, providing eager home buyers with an ample selection of property from which to choose.

"Consumer confidence in Saskatoon is positive despite the talk of an impending recession," said Norm Fisher, sales manager, Royal LePage Saskatoon Real Estate Ltd. "The local economy is buoyed by new business development and the expansion of existing business operations."

"To date our market has not been effected by the sluggish farm economy, however, consumers are being prudent in their purchases and the high-end market has stalled as buyers contemplate the higher costs associated with home maintenance."

An oversupply of high-end properties priced from $200,000 and up led to marginal price decreases in this category and created more home-buying opportunities for those business professionals contemplating purchasing.

Entry level and mid-priced homes from $100,000 to $160,000 were subject to the greatest demand with first-time buyers accounting for most of the activity. Empty nesters drove condominium activity and there was increased interest in this sector from first-time buyers.

Based on the Regina markets examined, the average price for a detached bungalow held firm at $110,000, while a standard two-storey home rose marginally by 1.4 per cent to $111,500, and a standard condominium property increased by 13.8 per cent to $82,500, year-over-year.

Consumer confidence waned in Regina due to the lagging farm economy, resulting in a slightly slower summer in terms of home sales. The adequate supply of homes at entry-level prices from $95,000 to $100,000 sustained a balanced market. However, a continued oversupply of high-end homes priced from $160,000 resulted in buyers' market conditions in this category.

"Sales of high-end homes subdued in part to a slowdown in the number of relocations into the city' said Brian Coolican, broker/owner, Royal LePage Regina Realty. "We anticipate the fall real estate market will improve as people who had postponed home buying in the spring and summer will likely take advantage of low interest rates and the selection of well-priced property available."

Regina and Saskatoon house prices

                  Detatched Bungalow

                  Price               Price     Price     % Change
Regina            July-Sep '01        3 mo.Ago  1 Yr.Ago  1 Year


  - North              110,000         105,000   110,000       0.0
  - South              110,000         110,000   110,000       0.0

Saskatoon

  - North              134,500         134,500   133,000      +1.1
  - West               118,500         118,500   115,000      +3.0
  - East End           136,000         136,000   133,000      +2.3
  - East Central       132,000         132.000   129,000      +2.3


                  Standard Two-Storey

                  Price                Price     Price     % Change
Regina            July-Sep '01         3 mo.Ago  1 Yr.Ago  1 Year


  - North              103,000          103,000   100,000      +3.0
  - South              120,000          120,000   120,000       0.0

Saskatoon

  - North              148,000          148,000   144,000      +2.8
  - West               130,000          130,000   125,000      +4.0
  - East End           163,000          163,000   160,000      +1.9
  - East Central       143,000          142,000   140,000      +2.1


                  Standard Condominium

                  Price                 Price     Price     % Change
Regina            July-Sep '01          3 mo.Ago  1 Yr.Ago  1 Year


  - North               80,000            65,000    60,000     +33.3
  - South               85,000            85,000    85,000       0.0

Saskatoon

  - North               92,500            92,500    90,000      +2.8
  - West                     -                 -         -        --
  - East End                 -                 -         -        --
  - East Central        85,000            85,000    85,000       0.0

SOURCE: ROYAL LEPAGE REAL ESTATE SERVICES LTD.