Canada

Toronto Real Estate Leads The Country In Average Price Declines, Saint John Pops Higher

The average sale price of Canadian real estate is falling, and fast. Canadian Real Estate Association (CREA) numbers show the average price of a home is down 11.3% in April 2018. Most of the declines are being attributed to the country’s largest and fastest falling real estate market – Toronto. Yeah, I haven’t heard of it either.

Average Prices

The rumors are true, average prices aren’t great for determining how much you’ll pay for a home. When the range of distribution for sales is normal, the average price is a very effective measure. However, when the range of distribution is wide, it will tend to skew higher and lower, depending on extremes. That is, extremes to the high and low of prices can skew the number in either direction. It’s still a useful indicator if you know what you’re looking for.

The average price can be a useful proxy for dollar volume, and upgrade flow. After all, CREA only deals with resales. Usually people that sell will be upgrading, buying a more expensive home as well. This typically sends the average higher. If people are selling, but have no plans on buying again in this market, you’ll see the average slide. Who sells and doesn’t plan on buying again you might be asking? At least a quarter of people planning to sell in Toronto this year.

Vancouver Has The Highest Average Sale Price In Canada

Vancouver, Toronto, and Fraser Valley are still the priciest markets in the country. Vancouver has the highest average sale price at $1,067,266. Toronto comes in second with an average sale price of $804,584. Fraser Valley is in third with an average sale price of $780,736. These markets have remained in the same order for quite some time.

Average Sale Price of Canadian Real Estate (April)

The average sale price of all homes in Canada by major CREA regions. In Canadian dollars.

Source: CREA. Better Dwelling.

Toronto Has The Fastest Dropping Average Sale Price

Saint John, Saguenay, and Victoria had the fastest rising average sale prices compared to last year. Saint John had an average sale price of $199,136, an increase of 22.9%. Saguenay had an average sale price of $202,729, a 15.8% increase. Victoria had an average sale price of $703,592, an 11.9% increase. The first two cities are seeing huge growth, but are still cheaper than the national average. Victoria has been on a tear, but it also has one of the biggest drop in sales-to-new listings in the country.

Toronto, Thunder Bay, and Hamilton regions are the fastest falling compared to last year. Toronto saw the average sale price drop to $804,584, a 12.6% decline. Thunder Bay had an average sale price of $217,745, an 11.9% decline. Hamilton – Burlington saw the average sale price drop to $569,490, an 11.3% decline. Toronto and Hamilton-Burlington saw huge gains last year, so a drop was expected.

Canadian Real Estate ASP Percent Change (April)

The percent change of the average sale price (ASP) of all homes in Canada by major CREA regions.

Source: CREA. Better Dwelling.

The average decline in prices across the country is being attributed to B-20 Guidelines. The Guidelines subject uninsured mortgage borrowers to undergo a stress test. This reduced the maximum size of a mortgage people could borrow. Some have claimed the stress will have minimal impact on borrowers. However, the Bank of Canada estimates over 81,000 buyers last year would have been impacted by the new rules.

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28 Comments

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  • JIJ 2 years ago

    Vancouver is holding up like a boss. Declining prices need people to sell at a loss, and due to the fact that this is a very wealthy city, people don’t need to sell at a loss. If you can’t afford it, Calgary is just a short flight away.

    • MH 2 years ago

      You speak the truth, Vancouver is for the wealthy. Those who are fuming over the mere $6K tax on their $5M house should start packing for Calgary.

      Sorry Calgary, you may experience an influx of [insert your favorite idiom here] soon.

    • Alistair McLaughlin 2 years ago

      Indeed, so rich you need programs like these:

      https://www2.gov.bc.ca/gov/content/taxes/property-taxes/annual-property-tax/defer-taxes

      http://vancouver.ca/home-property-development/defer-your-taxes.aspx

      Because even rich people need a little help with property taxes from time to time.

      • Alistair McLaughlin 2 years ago

        Oops. Double post. Man I wish there was an edit function.

    • Bluetheimpala 2 years ago

      Lol… Vancouver is the epicentre of funny money in Canada and and will see the biggest correction. That place is going to buuuurrrnnn. Now that bad foreign money is locked out we can take back our equity at the expense of bad money. No tears here. Thank you emperor Xi! BD4L.

      • Andrew 2 years ago

        ” Now that bad foreign money is locked out”

        Care to elaborate? Commenters around here made me think the faucet was on for good.

    • @xelan_gta 2 years ago

      It’s holding up only if you look at the prices.
      Ave. months of inventory is already at 5 in Vancouver, while in Toronto it’s only about 2-2.5 right now.
      Toronto prices are more volatile but fundamentally Vancouver is much closer to systemic crash.
      In any case both markets are heading to significant correction.

      • Tommy 2 years ago

        I think that’ll inventory will increase to around 3 months by the end of summer, and by the end of 2018 we’ll probably be looking at 4 months of inventory in Toronto.

        Many sellers are holding off in a stalemate situation with the hope that 2017 prices will return, but they won’t. Life goes on and people have to sell to retire and move somewhere cheaper, move for a job in another city, sell to upsize or downsize, and so on. They will have to discount price or provide some value added incentives when nobody bites on offer nights.

  • Tim2 2 years ago

    Thunder Bay! SO much for the ring of fire……

    Say it aint so =)

    Getting ugly there……

    • Sammy 2 years ago

      Getting ugly in Thunder Bay? The province needs to divide, so the Northern regions have better representation. Right now it’s being managed by policy that only benefits Southern Ontario.

  • showerthoughts 2 years ago

    We need a gov’t that’ll update the zoning laws to make it easier, faster, and less expensive for homes to be built. The game we’re playing right now only benefits people who already owned a home prior to 2015. I think we should raise the foreign buyers tax and increase housing supply. that way people who work and live here can afford to own a place to live. I understand that will upset the greedy capitalists in all of us but this is ridiculous…

    • Bluetheimpala 2 years ago

      You need to put a plastic bag on your head and go for a jog. Who knows how you might end up? Nothing is guaranteed in this world right? You are clearly a shill. Political or builder motivated. There is a ton of land available, but you know that. Many developers team up to buy land years in advance so they actually have land available, but you know that. The narrative that housing is expensive because we lack the land and by extension ‘pro developer’ policies is a joke as they are the biggest lobby in canada, but you know that. See you again muffin, good luck with that jog. BD4L.

      • showerthoughts 2 years ago

        I can almost see the toxic waste spewing out your mouth when you talk. You took my words and twisted them. Please go back under your bridge. TROLL!

        • Bluetheimpala 2 years ago

          Lol… Vancouver is the epicentre of funny money in Canada and and will see the biggest correction. That place is going to buuuurrrnnn. Now that bad foreign money is locked out we can take back our equity at the expense of bad money. No tears here. Thank you emperor Xi! BD4L.

        • Bluetheimpala 2 years ago

          Lol… Not sure what happened there…your shit stinks. I eat shit for breakfast. Yes I admitted to eating shit. See you tomorrow honey. BD4L.

      • Neo 2 years ago

        Blue,

        I don’t think you read what he wrote and he can correct me if I am wrong. But I think what he is saying is there is a lot of red tape to go through just to get a shovel in the ground for land that is available to build on. I was told up to 10 years in some cases. He isn’t saying necessary to free up more Greenbelt space, just to speed up the approval process for land available which is true. You were being a little to quick on the trigger here.

    • Ian 2 years ago

      Just a reminder that zoning laws were blamed for the price increases in late 1980s Toronto. The bubble popped in 1990, and prices didn’t recover until 2008. Zoning laws magically weren’t a problem after 1992. 😂

      • showerthoughts 2 years ago

        Unfortunately, the cartel running the BoC won’t let interest rise like they did in 1990. This time around, maybe a 50% foreign buyers tax and less gov’t/developer corruption is the recipe for a crash

        • Bluetheimpala 2 years ago

          Hey new friend. So you are a shill! And a political one… We all know what is going on when someone attacks the foreign buyers tax…Wink. I mean it isn’t like an entire party is using it as a platform in the upcoming election…we should have enacted the tax sooner and jacked up rates in 2016. Now we have people like you chiming in…thanks for playing.

          • showerthoughts 2 years ago

            These house prices and the general public’s justification for them are insane, just like you…

        • vnm 2 years ago

          Lending rates 1990 – 1993

          mortgage prime
          1990 12.01 1990 10.00
          1991 12.13 1991 9.50
          1992 9.71 1992 6.50
          1993 9.47 1993 6.00

  • Proof ? 2 years ago

    The average dwelling in Ontario (and other provinces, but I know Ontario best) has had its price also largely driven by the absolutely MASSIVE increase in development charges, fees, plans of subdivision, environmental compliance, HST, etc. etc.
    For the average detached house built last year (about $ 500,000 retail) in our area of Southern Ontario , this amounted to between 28 and 40 percent of the built cost. THIS DOES NOT INCLUDE LABOUR, MATERIALS nor LAND COMPONENTS , depending on local municipality tariff !!!
    Don’t believe me – go see the Builders Association figures they published, I believe in April in their monthly newsletter.
    From recent development experience, I can confirm these ratios.
    It is the “dirty little secret” that the Ontario government does not want you to know.
    Can’t afford a house – blame the Lieberals who started this with their ironically labelled “Places to Grow” policies and the big development restrictions that the 2005 Act enacted.

    • Bluetheimpala 2 years ago

      Ohhhh booyy…hmmmm…so these changes started in 2005 but the run up coincides with rates. So you are pumping a fake narrative in an attempt to be subversive and political. Shills are not allowed. You know enough about the business… You know you’re full of shit.

    • Trader Jim 2 years ago

      It’s really nice of developers to selflessly make no profits, and never be aggressive about margins. Shame on the city for driving prices up 30% in a single year. /s

    • vnm 2 years ago

      Complain, complain. If you can’t make a buck RE dev. during the biggest runup in history
      clearly you are in the wrong biz.

  • @xelan_gta 2 years ago

    Here is the fresh headline for you:
    “Macquarie thinks housing will drag Canada into a recession as bad as the financial crisis in two years — and that’s the best-case scenario”
    http://business.financialpost.com/news/economy/unprecedented-reliance-on-housing-fuels-canada-recession-call

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