Realtor Royal LePage says it expects the national real estate market to slow this year due to eroding affordability in Toronto and Vancouver and the fallout from declining oil prices in Western Canada.
In its latest report, the realtor says the average price of a Canadian home increased 6.5 per cent to $500,688 in the fourth quarter of last year, compared to the same period on 2014.
- Vancouver, Toronto real estate markets end year on sky-high note
- Home prices projected to fall in 3 oil-producing provinces in 2016
The average cost of a two-storey home nationwide climbed to $610,134 in the quarter, up nearly eight per cent compared with the previous year.
The price of a bungalow rose 5.4 per cent year-over-year to $420,082, while the average price of a condo grew 3.1 per cent to $341,448.
Royal LePage says it expects the average cost of a Canadian home to rise by a more moderate 4.1 per cent over the course of 2016.
Company president and CEO Phil Soper says "frenetic" price growth in certain large real estate markets is likely to moderate.
"While most of the country will continue to see house value appreciation in 2016, we expect that the pace of price increases in Greater Vancouver and the Greater Toronto Area — where real estate appreciation has significantly outpaced job and wage growth — will settle to a more sustainable, single-digit price increase trajectory," Soper said in a statement.