CREA: Only 3 Real Estate Markets Saw Price Declines, Including Toronto and Vancouver

Canadian real estate buyers haven’t been slowed down, and cheap cash may be fueling a new rally – at least for now. Canadian Real Estate Association (CREA) data shows the seasonally adjusted price of typical (benchmark) home, made big increases in June. The growth over the past 12 months has actually been so large, it represents the majority of gains over the past 3 years.

Price Increases Over The Past Year Represent Almost 90% of The 3-Year Gains

Canadian real estate prices are growing at a breakneck speed in contrast to the past few years. The seasonally adjusted benchmark price for a home reached $623,000 in June, up 0.50% from the previous month. Over the past 12 months, prices are up 5.65%. This may not sound like a lot compared to how some cities have moved, but according to CREA prices are only up 6.36% over the past 3 years. That would mean 88.83% of the price increase over the past 3 years, was realized in just the last year. It’s a lot of growth for a short period of time.

Canadian Real Estate Benchmark Change

The 12 month change in the unadjusted benchmark price of a home across Canada.

Source: CREA, Better Dwelling.

Canada’s Biggest Monthly Price Increases Were Huge

Canada’s biggest monthly price moves were monster increases. Hamilton made the biggest price increase with the benchmark hitting $669,700 in June, up a seasonally adjusted 2.26% from a month before. Quebec City followed with a benchmark of $252,700, up 2.25% from last year. Winnipeg made the third largest move with a benchmark of $277,500, up 1.87% from a month before. Of the three, Quebec City’s movement is the most notable. The monthly increase is so large, it’s actually bigger than the 12-month increase.

Canadian Real Estate Benchmark Price Change

The seasonally adjusted monthly price change for Canadian real estate markets.

Source: CREA, Better Dwelling.

Only 3 Canadian Real Estate Markets See Price Declines

There were only three real estate markets to see a monthly price decline, but they were some of the biggest. Calgary made the largest monthly drop with a benchmark of $403,500 in June, down 0.39% seasonally adjusted from the month before. Vancouver followed with a typical home dropping to $1,013,600, down 0.23% from a month before. Toronto was the third market with a benchmark of $852,900, down 0.18% from a month before. Not huge drops, and certainly not movements the size of the gains, but three declines nonetheless.

Canadian Real Estate Benchmark Price Change

The seasonally adjusted annual price change for Canadian real estate markets, compared to the 3-year change.

Source: CREA, Better Dwelling.

Canadian real estate prices made substantial gains over the past month, pushing annual gains much higher. Over the past year, prices have moved so quickly, they dwarf the movements of the two years prior. Large markets that have recently outperformed national price movements like Toronto and Vancouver however, are making slower gains – actually rolling back a little last month.

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  • Jeffery L 4 years ago

    Government is essentially saying they’ll print home prices. Why wouldn’t you buy now?

    • Ian 4 years ago

      For the wrong reasons though.

      They want homeowners to be able to access their home equity for this emergency. It’s not a coincidence CERB is the same as mortgages + food.

    • alvi 4 years ago

      Yeah interest rates will remain low for a very long time,might fuel a super cycle increase- bust in next 3-5 years, the only question is how much of a gain then how much of a bust

  • Gerry 4 years ago

    Condos in Vancouver are trash, but homes are on fire.

    • alvi 4 years ago

      Yeah there has been the same outperformance in the GTA, I womder if 2017 highs for single detached will be approached.

  • Hgbvv 4 years ago

    This is the most horrible bubble in human history…..

  • RainCityRyan 4 years ago

    Low volume (in YVR based on 10yr average) and large price movements does not an efficient market make.

  • AyyyLmao 4 years ago

    Been watching condo prices drop in Toronto, but houses for less than 2 million have been on fire in the city. Its hard to make sense of it all when private debt remains extremely elevated, business debt is elevated, unemployment is high and job security is low. The government keeps punishing people who are responsibly saving money by bailing out those who are irresponsible and living beyond their means, the question is what happens at the end of CERB and mortgage deferrals, do those who have been struggling to make ends meet throw in the towel and list their homes flooding inventory or does GOV extend these programs for the foreseeable future.
    The catalysts for downward pressure would be: recession, high unemployment, the ending of the welfare programs for debtors, a wave of covid in the fall that forces shut downs all over again, inflation spikes and interest rate hikes are req.
    Catalysts for upward pressure: Welfare continues, no second wave or a vaccine is rolled out, people who couldn’t afford their current 2 mill or higher home, sell and down size to a smaller home out bidding those in the 1 mill market, with the heightened political turmoil in Hong Kong and china, we see some wealthy asians fleeing to Canada and out bidding locals and distorting prices, interest rates somehow manage to go even lower.

    • Paco Ramirez 4 years ago

      “the question is what happens at the end of CERB and mortgage deferrals.”

      I know this one.
      UBI, or a short of Negative Income Tax implementation happens to rescue the butts of the creditor risk-takers again. We will ride this distorted debt utopia beyond our means together, including responsible savers who will gladly pay for it as far as this UBI is presented as a free money scheme.

  • Nika 4 years ago

    The condo market tells a different story so don’t believe the hype about house prices being on fire. Yes maybe for single detached homes but not for the condo market. Many condos in downtown Toronto are going for less than asking. Remember when they used to go for 10% or more over asking. I was looking for a condo back in February and was willing to go as high as $560,000 for a one bedroom shoebox/broom closet (and good luck with even trying to get to view anything back then without it being sold by the time you got there for a viewing). Now…I’m spoiled for choice and can stay around the $500,000. Wait until winter, as the other commentators have written. Toronto is in the height of churning out thousands of condos projects and wants to create this hype lest the market crashes with a thud. Of course there’s been pent up demand but will this continue into the Fall and Winter without a vaccine and Covid 19 still springing up here and there? And what if numbers go down…do they really want to increase travel etc. and have another increase?

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