Canada

Canadian Real Estate Prices Experience Smallest Growth Since 2008, Dragged By The West

Canadian real estate markets are experiencing growth, just not much of it. The TeranetNational Bank of Canada House Price Index (TNB HPI) shows prices made an increase in November. The increase, the second smallest for November in the history of the index, shows low growth. However, it is the fourth consecutive month of acceleration, so things could be looking up.

Canadian Real Estate Prices Rise Less Than 2%

The C11, an index of Canada’s largest eleven markets, made a small increase. The index rose 0.16% in November, and is now 1.43% higher than the same month last year. It’s at a new all-time high, but growth is still low. Most of the drag is due to Western Canada holding the index back.

Teranet-National Bank HPI C11 (Annual Change)

The 12 month percent change of real estate prices in Canada’s 11 largest cities, according to the TNB HPI.

Source: National Bank of Canada, Teranet, Better Dwelling.

The C11’s growth rate is still unusually low, but has shown signs of acceleration. November’s 1.43% 12-month growth is the lowest for the month since 2008. Other than that, we haven’t seen anything this low in the TNB HPI.  This is the fourth consecutive month of price acceleration, so it’s unclear how long this will last.

Toronto Real Estate Prices Rise Over 4%

Toronto real estate prices haven’t moved much from last month, but the 12-month growth is big. Prices were virtually unchanged, moving 0.04% in November. Prices are now up 4.20% from the same month last year, and just under the all-time high. This follows a minor monthly pullback of the index last month.

Toronto Real Estate Price Change

The 12 month percent change of real estate prices in Toronto, according to the TNB HPI.

Source: National Bank of Canada, Teranet, Better Dwelling.

Vancouver Real Estate Prices Are Down Over 5%

Vancouver real estate prices are still down, but they did climb last month. Prices in the region increased 0.41% in November, and are now down 5.19% from the same month last year. Peak prices were hit in July 2018, and they’re down 6.89% from that level. The market is seeing improvements, but still has a way to go before getting there.

Vancouver Real Estate Price Change

The 12 month percent change of real estate prices in Vancouver, according to the TNB HPI.

Source: National Bank of Canada, Teranet, Better Dwelling.

Montreal Real Estate Reaches A New All-Time High

Montreal real estate prices are moving higher, and into record high territory. Prices in the region increased 0.26% in November, and are up 6.37% from the same month last year. This is a new all-time high, but prices aren’t quite at nosebleed levels yet. Montreal was left out of the national price rally over the past few years, and still hasn’t increased as much as Southern Ontario or British Columbia.

Montreal Real Estate Price Change

The 12 month percent change of real estate prices in Montreal, according to the TNB HPI.

Source: National Bank of Canada, Teranet, Better Dwelling.

Calgary Real Estate Prices Are Still Down From 2014

Calgary real estate prices advanced, but are still down from last year. The region saw price rise 0.16% in November, and are now down 0.90% from the same month last year. Prices are still 5.66% below the all time high reached in October 2014. Yes, prices still haven’t recovered after half a decade.

Calgary Real Estate Price Change

The 12 month percent change of real estate prices in Calgary, according to the TNB HPI.

Source: National Bank of Canada, Teranet, Better Dwelling.

Local markets are embracing prices rising as “low inventory” or volume based trends. However, prices are rising in almost every major city across Canada. This likely has less to do with things like local fundamentals. Instead, this most likely has to do with a rise in cheap financing and national buyer expectations.

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5 Comments

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  • Dave 4 months ago

    People need to stop comparing the west to Southern Ontario. There’s no jobs out west, as opposed to Toronto – where we can sell each other houses forever.

  • Mahmud 4 months ago

    Fitch’s institutional note shows is forecasting more expensive mortgages next year, and growth to cut to 25% of what it is now.

    That’s a divergence from what they expect from overnight rates if I’m not mistaken, which should be worrying to the industry.

    • Sophia 4 months ago

      A few months ago my bank was offering me 2.79 for 5 years closed. Today , it offered me 2.99 for the same term so the rates went up.
      As for small growth, we can thank to the greedy real estate agents, they are the one who drive the prices and suggest increased home values each year.
      One agent told me how they they elevated prices in 2017 but that is a different topic.
      I also noticed that they become more and more greedy, 10 years ago , they wouldn’t mind if they spent even 6 months with you but nowadays, they want a quick transaction, show you a few houses and you buy the one they like. Canadian real estate market is due to government as well as ordinary people greed. No thoughts for future generation and young people at all.

      • Brad 4 months ago

        Fixed rates move based on the bond market so they are constantly moving up and down. My brother was offered 2.79% just last week so it’s going to highly depend on current bond paper pricing as well as risk management of the institution.

  • straw walker 4 months ago

    Vancouver is turning many residential housing into income property.. Airbnb has changed the face of residential housing. A house with 8 bedrooms and 8 bathrooms with numbers on each door and a welcome mat at the entrance is destroying the nature of homes in some areas of Vancouver.
    These houses are not homes but mini hotels and need proper zoning …and also proper taxing as they are NO longer detached residential homes..
    These homes are selling as investment income and not as a family home..therefore they should be in an area of commercial zoning and should not be sold as a home. These houses are selling and altering the pricing of a real home in the area.

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