Canadian real estate went from rising tens of thousands per month to falling just as fast. In March, most markets saw monthly growth of the benchmark price fall, according to CREA data. The issue is more pronounced in Ontario, where markets fell up to $40k over just a few days.
Most Canadian Real Estate Markets Have Seen Growth Slow
Canadian real estate prices are still rising but at a much lower rate. A typical home across Canada rose by $18,900 in March, less than half of February’s $43,200 increase. Don’t get me wrong, $18,900 is still a large increase, it just hasn’t been that low since December 2021. The sky isn’t falling but the market is changing very fast. Nearly two-thirds (63%) of benchmark indexes showed slower growth from February.
Canadian Real Estate Monthly Price Change
The monthly change in the composite benchmark price for markets across Canada.
Source: CREA; Better Dwelling.
Ontario Real Estate Leads Monthly Losses, Markets Drop Up To $39k
Ontario real estate showed the most abrupt change, representing almost all price drops. The four worst-performing markets for the month were Cambridge ( -$39,500), Kitchener-Waterloo (-$14,500), Oakville (-$7,100), and Hamilton-Burlington (-$3,400). The only non-Ontario market to show price declines in March was Newfoundland.
The Most Abrupt Swing In Price Growth Was Also In Ontario
Ontario isn’t the only place seeing a slowdown, but it was also the place with the biggest growth swing. Cambridge’s $39,500 drop in March was $105,700 lower than the gain a month before. The second biggest swing was in Mississauga, where growth shrunk by $87,300. Hamilton followed with March’s movement $74,200 smaller than the one seen in February. Sorry to all of those folks that thought prices would rise $40k/month forever.
Some Smaller Markets Continued To Rise Up To $34k
There were a few big monthly gains seen in Halifax (+$34,000), Bancroft (+$32,800), and Kamloops (+$29,300) in March. All three markets accelerated from February, being outliers in the trend. This highlights how split the country is on prices — some regions haven’t seen a rate impact at all.
March marked a big change in direction for the market with a minimal impact from interest rates. Only one hike occurred that month and it was tiny. Many buyers would have also had rates locked in, which would have left them with no impact.
As some institutions have warned, this isn’t an issue of demand so much as one of speculation. It generally takes 18 to 24 months for a rate hike to fully hit the market, but only minutes to kill exuberance.