TORONTO - Brookfield Real Estate Services Inc. (TSX:BRE), which operates under brands like Royal LePage, says its second-quarter net earnings rose 60 per cent as home sales remained strong.
The Toronto-based real estate services company said Thursday second-quarter earnings amounted $7.8 million, or 83 cents per share, up from $4.9 million, or 52 cents per share.
Royalties were $10 million, up from $9.8 million a year earlier.
Expenses were also down, to $5.9 million from $6.4 million in the year-ago quarter.
During the quarter, cash flow from operations were $7.4 million, up from $6.8 million for the same period in 2011 as a result of increased market activity, a $200,000 bump in the recovery of previously written off receivables and reduced reporting costs.
Real estate sales in Canada remain strong as low interest rates spur people to buy.
"While tumultuous economic conditions beyond our borders have been a drag on Canadian consumer confidence, the relatively favourable domestic outlook and stimulative effect of pervasively low interest rates have continued to support real estate activity at healthy levels," said Phil Soper, president and chief executive officer.
However, Soper also warns that while the industry has enjoyed three strong years of strong home price growth, they cannot continue to grow faster than salaries and the underlying economy forever.
"Some regions have reached or perhaps even exceed the current upper level of price resistance. We expect prices and unit sales to level off in many major markets, bringing the full year 2012 into line with our original growth forecast."