Canadian Real Estate Prices Return To Growth After Brief Decline

Canadian real estate prices are back to growing, after seeing minor price declines for half of a year. Canadian Real Estate Association (CREA) numbers show home prices have returned to growth in July. National price growth is being driven by a boom in markets that underperformed over the past 5 years.

Canadian Real Estate Prices Return To Growth After Brief Decline

Canadian real estate prices made a big move last month. CREA’s seasonally adjusted, national benchmark price hit $620,900 in July, up 0.57% from the month before. This represents an increase of 0.22% compared to the same month last year. If you didn’t catch that, the adjusted monthly gain was so large – it pulled the market out of negative growth.

Canadian Real Estate Benchmark Change

The 12 month price in change of a typical home across Canada.

Source: CREA, Better Dwelling.

Prices are down just a bit from the peak, but things improved on the annual trend for a second consecutive month. The national market’s benchmark at $620,900 is just 1.62% from the all-time peak for prices. The annual pace of growth is now positive, but it’s only the second improvement. Two improvements don’t make a trend, but they can start one – so it’s worth watching for a reversal.

Biggest Gains Were In Markets That Underperformed

Markets that underperformed over the past 5 years made the largest move. Ottawa’s benchmark price made the largest annual increase to $423,900 in July, up 8.84% from last year. Montreal followed with a benchmark of $366,400, up 7.23% from last year. Guelph came in third with the benchmark hitting $546,600, up 6.73% from last year. Of those three, only Guelph outperformed the national market.

Canadian Real Estate Benchmark Price

The price of a typical home in Canada’s largest real estate markets.

Source: CREA, Better Dwelling.

Leading the way lower is Western Canadian real estate. Greater Vancouver’s benchmark showed the largest drop to $978,500 in July, down 9.38% from the same month last year. Fraser Valley, a market surrounding Vancouver, fell to $809,800, down 6.58% from last year. Regina came in third with a benchmark of $265,400, down 4.55% from last year.

Canadian Real Estate Price Change – 1 Year

The 1 year percent change in the price of a typical home, in Canada’s largest markets.

Source: CREA, Better Dwelling.

5 Canadian Real Estate Markets Are At New All-Time Highs

Five Canadian real estate markets are at a new all-time highs. Ottawa’s benchmark hit $423,900 in July, up 8.84% from last year. . Montreal reached $366,400, up 7.23% from last year. The Niagara region topped $410,000, up 5.85% from last year. Hamilton’s benchmark increased to $603,500, up 5.02% from last year. Moncton, the cheapest major market, reached $185,700, up 2.21% from last year. Note, not one market at an all-time high is in Western Canada.

Canadian Real Estate Price Change From Peak

The percent change from peak pricing for a typical home in Canada’s largest markets.

Source: CREA, Better Dwelling.

Western Canada was home to the biggest declines from peak. Edmonton’s benchmark is furthest from peak at $319,200, down 14.61% from last year. Regina followed with $265,400, down 13.75% from last year. Vancouver made the third largest fall from peak with a benchmark of $978,500, down 11.42% from last year. With the exception of Barrie, all markets over 3% from their peak benchmark price are in Western Canada.

Canadian real estate prices are back to positive year-over-year gains. This comes after national prices made a decline for less than half a year. It also comes ahead of the government’s first-time homebuyer plan. The plan will inject over a billion dollars in liquidity, because you know… affordability.

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  • Tia Wolfe 5 years ago

    Let me get this straight. According to the benchmark, Canadian real estate hasn’t had a correction in over 20 years? How is that possible?

  • Jupiter 5 years ago

    When vast majority of citizens can afford housing with normal wage it’s time for the government to step up.
    1. They need to tax all foreign owned residential property, like many other countries.
    2. They need to make sure none REIT corporations can own residential property.

    We can’t have foreign entities leech blood from young families any more.

    Pop this bubble or Toronto is going to turn into HongKong where thousands will riot because young people can’t afford housing.

    • John Jay 5 years ago

      People are protesting in HK to maintain the rule of law instead of doing whatever the communist party of China wants to do. It isn’t about property prices.

      Canada isn’t going to willingly pop our housing game. Too much of the economy and voters are tied into it. If it goes down so does the entire Canadian economy. No politician wants that tied around their neck.

      The only people who are screwed are young people. First time buyers who don’t have the advantage of the bank of mom and dad are screwed unless they are in the highest income brackets. Now, don’t forget, this only really applies to Toronto and Vancouver. The rest of the country is relatively affordable given local wages. They might be stretched but nothing like Toronto/Vancouver.

      Toronto will become a pure renter city except for the upper echelon.

      • Neo 5 years ago

        Not exactly true, Airbnb is a real problem in small towns pricing out young families. Take Prince Edward County and a town in it like Picton. Population 4,000 but a tourist spot overrun by tourist 4 months out of the year. Every other house is a short term rental. Ghost town in the winter and all the starter homes are being bought up. All the new developments are geared towards Torontonians and US residents. Local residents are being priced out.

  • Ahmed 5 years ago

    It must be Montreal’s green belt. 😂

  • Zenity 5 years ago

    I think any sane young people should be very angry. The system itself transfers wealth in form of heavy taxation on your income to keep boomers alive. Then they do nothing about this housing bubble which drains what little remains of your income. Please google houses for sale in any other major u. s city you will understand how much you have been cheated by the government.

    Time to realize if you are young and have the opportunity to leave you should. If not fight back, this predatory housing slavery of young families is criminal. As long as you remain silent they will keep transferring your hard earned money to boomers. Wake up people, they will try to shame you and make fun of you to silence you. Be stronge and speak out for your future. No more predatory housing by foreign money laundering and local real estate hogging.

    • Millennial Whinger 5 years ago

      Why the hate against an older generation? This I just don’t understand. You will be old one day too. Would you like to not have support through your older years? Also, you do realize much health care dollars are spent on having and raising healthy children, correct?

      So many of my generation, millennials, suffer from victim mentality and outright entitlement. Yes, house prices are high and yes many boomers made out like bandits but so did gen x and many millennials who were intelligent enough to set up with some real estate while young.

      If you don’t like how things are aroud you there are many options, you might want to look into them.

      What a sad state of affairs these days. Very, very sad. This generational warfare needs to stop. It’s embarrassing.

      • Trader Jim 5 years ago

        It’s not hate, it’s resentment. This has nothing to do with age in particular. It has to do with the previous generations lack of savings, demanding rates be pushed down. They’re forcing households to acquire debt so the value of their assets rises.

        When millennials reject buying homes, they demand the government cuts rates, raises taxes, and push rents higher. When immigration goes up to help offset the dependency rate, they demand we lower immigration and just increase taxes on young people to make up for their lack of income.

        The previous generations didn’t have the incomes we have, they have one asset – property. So they demand cheaper property taxes and lower capital gains, while raising income taxes. It’s not resentment because of age. It’s resentment because it’s a robbery.

        • Millennial Whinger 5 years ago

          This is a very sad view of the world.

          Things aren’t great, I would be the first to agree, but this victim mentality will destroy your life.

          • Luigi Vampa 5 years ago

            I’m confused… he made some pretty valid points that are supported by the historical data on wealth accumulation and distribution by generation. Might be a little strongly worded with the “robbery” bit and all but its not inaccurate. One group (i.e boomers) have lobbied for decades to improve their standing in life, now another group (i.e. milleneilas etc.) speaks out to push back have the pendulum swing the other way. Back and forth it goes… its the natural way of democracy. I’m not a millennial myself and am lucky enough to be a home owner but see his point. Greater balance is required or the whole system will collapse. These times are worrying to say the least.

        • Aldi 5 years ago

          All generations have their challenges just like all generations have different tastes in music.
          The baby boom generation faced much higher interest and unemployment rates and the fwo greatest recessions since the Depression in the early 80s and 90s,
          The previous generations of baby boomers and some Gen Xs also insisted that governments get their fiscal house in order, something that has been lost since 2007, with the reassertion of lax fiscal and monetary policies.
          And as for the generation before the Boomers, how about the Great Depression and World War 2 for starters.

      • Average Man 5 years ago

        No dummy. Most of us won’t get to be old. We’ll just drop dead at 70 on our way to our second job.

      • Millenial 5 years ago

        I get the feeling you’re not a millennial.

    • carlton 5 years ago

      Well said brother, a lot of people are suffering in silence barely making payments borrowing from heloc every month. Some of the smarter people know housing is currently a debt trap as most can’t and will never pay off that 700k starter town home that currently takes 22 years to save the down payment.
      Until people start making this an issue nothing will be done. What is government doing about all that laundered money anyhow?

    • Louis 5 years ago

      Millennials want their avocado toast and eat it too.

  • GB 5 years ago

    and People thought a soft landing wasn’t possible… and now mortgage rates are lower vs the 2H 2018, so easy comparisons are coming.

    This is good news, since the majority of Canadains are in fact Homeowners.

    • JW 5 years ago

      You’re an idiot if you think less than a point gain going into the recession is a soft landing.

      Let me guess. You’re one of those money managers that made their clients 6% this year, while losing 7% against USD, right?

  • Joseph 5 years ago

    “Canadian households are carrying large amounts of debt. A recent Statistics Canada report found that household debt grew faster than income in the fourth quarter of 2018.”

    Housing prices go up and debt goes up; income’s not keeping up. Not good.

  • CanadaSucks 5 years ago

    CAD is going down against the US dollars again. Canada is done. I expected the bank of Canada to cut rate and send the CAD lower. That will be the end of Canada and the beginning of currency devaluation and hyper inflation in Canada. Pooploz will be successful at generating inflation, the kind of inflation that generated currency devaluation and will turn Canada into third world status. Just look at Australia and New Zealand currency. This is your future Canada.

    I predict we will see reverse mass migration out of Canada. Why live in Canada poor with 6 month of cold when you live in India, Philippines, Thailand where there is no cold.

    • Shawn 5 years ago

      lol…how on earth is living in India an alternative?

    • Louis 5 years ago

      Will you be the first?

    • Canadasucks 5 years ago

      Lol no one is moving to India or the Philippines.

      • Kathleen Thomson 5 years ago

        India actually has the highest number of immigrants of any country.

        Don’t let the Western arrogance fool you. Asia and South Asian countries are quickly developing and projected to soon surpass the quality of life in G7 advanced economies. Most projections have it as soon as 2025. Higher GDP growth, lower cost of living, and the top university spots at foreign schools are being held by international students.

        There’s a reason we don’t see Mainland Chinese students stay here for long afterwards. They take the high quality (but declining quality of education), and return home. The immigrants we get are temporary at best, until they realize their peers are all doing better than them “back home.”

    • Tintin 5 years ago

      Ha ha ha… You poor poor man. So much anger & hate. You need to get laid!

  • jon snow 5 years ago

    no surprises here, the GTA market had pent up demand from buyers just waiting to jump in. it sucks for affordability but as long as rental rates keep going up, dont expect house prices to drop anytime soon because whether you like it or not, people want to live in Toronto and are willing to pay ridiculous amounts of money to do it.

    • Travis Hunter 5 years ago

      So now that it’s more expensive to buy a home in Toronto than New York, it just keeps going up higher and higher and higher until infinity?

    • aldi 5 years ago

      Agreed, with all the doomsday talk on this board as a contrary indicator, housing prices have stabilize and may even go up in the next 5 years. This talk about a mass exodus of people out of canada, people selling their homes to ptich tents, the canadian dollar going to zero,the end of this country, even of civilization as we know descending towards total dystopia reminds me of what was being said about Canada in the early 90s.

  • Joseph Patterson 5 years ago

    Average price in toronto will go up from 1.1m to 1.8m by the spring of 2020.

    • Travis Hunter 5 years ago

      How much does it cost for a gallon of milk in this scenario? $100?

  • Dan 5 years ago

    Socialism for the rich capitalism for the poor…bail out the rich…hand the bill to the tax payer…

  • Ima Faque 5 years ago

    Is housing affordability in Canada boiling over into a very uncanadain like general backlash? Interesting read titled Who is GW1 89K:

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