Canada’s small cities seem to be catching FOMO. Canadian Real Estate Association (CREA) numbers show large cities are seeing price growth taper. Meanwhile, smaller real estate boards are seeing real estate price growth outpacing major cities.
Yes, You Should Care About National Prices
We know, you don’t care what’s happening in Ottawa – you live in Toronto. Well, you should. National trends are useful for learning about the credit and exuberance in a country. If your dense market is rising, and everything else is falling – it could be local factors driving prices. If your market is rising, and everything else is rising – it’s probably credit related. Credit related price movements tend to contract when credit takes a downturn as well.
Vancouver Real Estate Is Still The Priciest In Canada
Canada’s most expensive real estate markets are Vancouver, Fraser Valley, and Toronto. Vancouver saw the price of a typical home reach $1,087,500 in July, up 6.68% from the same time last year. Fraser Valley, also in BC, saw the price of a typical home climb to $831,300, up a massive 13.83%. Toronto fell to $768,400, down 0.6% compared to last year.
Canadian Real Estate Prices
The price of a “typical” home in major Canadian cities in July 2018, in Canadian dollars.
Source: CREA, Better Dwelling.
BC Has The The Fastest Rising Home Prices In Canada
Real estate prices are rising fastest in Fraser Valley, Vancouver Island, and Victoria. Fraser Valley’s 13.83% increase to $831,300 makes it the fastest growing prices in the country. Vancouver Island saw prices climb to $489,800, up 13.75% from last year. Victoria saw their benchmark rise to $672,800, up 8.24% from the same time last year. All three of these markets were in BC, with Vancouver coming in as the fifth fastest rising market.
Canadian Real Estate Annual Price Change
The annual price change of a “typical” home across Canada in July 2018, in percentage points.
Source: CREA, Better Dwelling.
Smaller cities are seeing real estate prices rise very quickly, an odd trend to say the least. Density appears to be less of a factor, and home price expectations seem to be rising. Most of these markets are seeing tapering sales, but rising prices. Exhaustion behavior in relatively suburban markets is a strong indicator the late stages in a national credit cycle.
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People in BC are ridiculous. Now to wait for the millennial that says they paid 20% over ask, because the foreign buyers were coming for their home. Their agent told them that, and they heard it from an agent on the news.
Same problem in Toronto tbh. Least year agents were advising their clients to bid massive amounts over the ask in order to be “considered.” Then they blamed foreign buyers for the purchasing. You don’t think it had anything to do with all of you telling your clients that ask prices are suggested starting points?
pure lies. the agents got their commisions and the buyer got their debt. simple as that. If you buy thinking in resale, now you are indebted to death and you would like to keep this scam going on indefinitely; but they have two option. sell at a massive discount or declare bankrupty. they won’t find another stupier person than you were in the planet.
Nobody is selling at a massive discount – if you want to live in a specific neighbourhood then you will pay what the seller is asking.
Those wondering what Fraser Valley looks like, imagine a trailer park in the mountains. Great views, but the vast majority of homes shouldn’t cost nearly as much as they do.
interested for an update on how renewals are going in the post B20 environment. Several stories in Q1 re: homeowners having to kick in additional equity to avoid higher rates. Is this still a thing or are Banks playing nice and eating into their spreads for non qualifying loans ?? any insiders up for sharing the goods?
I don’t think we’ve seen empirical data yet at this point, but I can tell you that my father-in-law (mortgage broker) went from over 90% of his business being mortgages for home purchases over the last decade, to now over 90% being second mortgages, HELOCs, and emergency private loans (especially in new builds coming to completion this year and people no longer qualify due to B20. He said the majority of customers are using these in order to “wait out” their current phase of being broke until they are “above water next year once prices are back” and can sell. He said a lot of the stories are sad, but it’s his job and not his place to recommend eating a bankruptcy.
Thanks for that Brad.
I am waiting to see how the condo market plays out. Record pre sales in 2017 for condos. Fair amount in 2015-2016 as well. I took a look at a couple in early 2017 and was shocked to see that they were priced equal to similarly located resale condos. All of these arrangements were made prior to B-20 and rate rises and will be coming online in the next 3 years. As per yesterdays article about Toronto once again leading NA in cranes. I believe this is going to turn into an absolute shit show.
One of the most important functions of government is to protect the Price System — for everything. I do not mean price controls or anything foolish like that. The government knows that its policies affect the Price System. In Los Angeles, the city has followed a policy to destroy rent controlled housing which drastically limited housing supply at the lowest end of the market. Not only did that throw thousands of poor people directly on to the streets, it inflated the rents at the lowest end of the market so that many Angelenos pay over 50% of their income for rent. As a result, Los Angeles now has the worse homeless crisis in our country.
Around the world, there is a direction correlation between New Urbanism and rising housing costs which results in other social ills. It seems, but I do not know for a fact, that Los Angeles’s extremely high level of corruption has accelerated the problem and Canada may merely be experiencing the ill effects of myopic New Urbanism planning.
The movement of Family Millennials to smaller cities and towns may be a result of the unduly inflated housing costs in Toronto, etc.
Hate the ridiculous real estate price.The price in Edmonton or Calgary make sense.
yes, the market in deadmonton is stagnant, just like the entire city’s culture. You get wat you pay for. the future of canada is chinese now that truedope sold it through QIIP, ie, you’ve been fucked up the ass
lol you’re right. You do get what you pay for. If you want to pay less and live in a horribly boring and cold as hell city like Ottawa then sure go ahead!
Their real estate prices are getting ridiculous.
Victoria is getting crazy with one bedroom condos with a decent view and or location are going for over half a million…this would have been laughable only two years ago.