Home prices in the metro region are rising three times the rate of inflation and, for the first time ever, the price of an average home cracked the $400,000 mark.

A house which sold for about $265,000 five or six years ago is now in the range of $370,000.

Bill Stirling, executive director of the Newfoundland and Labrador Association of Realtors, says the average household has to work half-a-year longer to cover housing costs.

Over half of all houses which sold went for more than the asking price, often the result of a bidding war.

Stirling says several factors come into play including a strong economy and a population of about 550,000, but the real issue is lack of supply. He says we have to build quicker and one way to accomplish that is to reduce red tape – and expense.

“The average holding cost on a piece of land from he time a developer buys it to the time the developer sells the house is $42,000 per lot – so that expense is added to the price of the house,” says Stirling. “We have to find a way to prioritize projects to get them through the process quicker and get shovels in the ground.”