Royal LePage real estate company expects the total home price in Canada to rise by seven percent in the last quarter of 2023 compared to the same period last year, reducing its previous forecast by 8.5 percent.

This decline reflects the slowdown in the third quarter, during which the total price of national homes increased by 3.6 percent year-over-year to $802,900, but decreased by 0.8 percent on a quarterly basis.

More than half of the 63 regional markets analyzed by the company in its latest home price survey recorded a decline in prices on a quarterly basis in the third quarter amid a decrease in sales activity.

The report released this Thursday also stated that "while many Canadians have adjusted to the increased cost of borrowing, high-interest rates continue to affect activity in markets across the country."

Total home prices in the Toronto and Vancouver areas declined by 2.8 percent and 1.8 percent, respectively, compared to the previous quarter, while the Greater Montreal area recorded an overall price increase of 0.6 percent.

Phil Soper, President and CEO of Royal LePage, stated in a press release: "Prices remain high year-over-year, contrasting sharply with the sharp declines witnessed in the third quarter of 2022. While transaction volumes in most areas remain slow, the Canadian housing market stands on a strong foundation, with increasing pent-up demand. We do not expect any significant changes in property prices during the remainder of the year."

In addition to reducing its national year-end forecast, Royal LePage also revised its regional forecasts downward for the Greater Toronto Area, Edmonton, and Regina. It maintained its previous forecasts in major areas such as Montreal, Vancouver, Ottawa, Winnipeg, and Halifax.

Calgary bucked this trend as the only city where the overall year-end price forecasts increased, which the report attributed to continued activity during the summer and a strong start to the fall. Royal LePage expects the total home price in Calgary to rise by 9.5 percent in the fourth quarter compared to the previous year.

The report also mentioned that "the area, which continues to attract buyers from across the country, experienced a moderate yet steady increase during the pandemic-fueled boom, and saw smaller fluctuations during the recovery, which kept prices stable."

Disaggregated by housing type, the national average price of a detached single-family home rose by 3.4 percent to $833,600 in the third quarter compared to the same period in 2022, while the average price of a condo increased by 3.8 percent to $587,400.

On a quarterly basis, the average price of a detached single-family home decreased by 1 percent, while the average price of a condo increased by only 0.1 percent.