Time for your weekly update on the most important stories in real estate.
Canadian Real Estate
Toronto area markets are seeing the largest growth in new listings across Canada. Hamilton, a quick train ride from Toronto, is seeing new listings year to date grow by 15.6% compared to last year. This puts Hamilton in first for the largest growth of new listings in the country. In second is Toronto itself, with year to date new listings 13.7% higher than the same period last year.
On the flip side, the Greater Vancouver Area saw the largest decrease in new listings. Fraser Valley saw new listings year to date drop 13.2%, the highest decline in the country. Vancouver saw a 12.9% decline in new listings, the second largest in the country.
Canadian consumer debt is rising at a rapid pace. The total of non-mortgage debt now stands at $590 billion, up $24.9 billion from the same time last year. This represents a 4.4% increase from last July. July saw an annualized increase of 7.9%, which indicates it’s actually accelerating. Debt warnings be damned, Canadians want to borrow more.
Toronto Real Estate
Toronto real estate might have a flipping problem. Analysis of listings for sale at the beginning of the month, show that 6.2% were bought within the past 18 months. These sellers listed the properties for an average of $159,477 higher than they were bought. I know what you’re thinking, what’s the harm with reno flips? Only 2.4% of these listings mention any sort of renovations. The vast majority were just bought and held for an average of 209 days before being sold.
Toronto condo prices made huge gains over the past year, but are finally starting to fall back to reality. According to the Toronto Real Estate Board (TREB), prices declined in 3 out of 4 neighbourhoods. The benchmark price is still 26% higher than last year, with one region up 52%. It’s hard to say prices are correcting when they’re up double digits from last year. However, it’s also becoming increasingly hard to see them continue to climb from here.
Vancouver Real Estate
Vancouver condos are making huge gains, but growth numbers are tapering. The condo benchmark rose to $626,800, up 19.4% from the same time last year. The 19.44% is huge growth, but is 29% lower than the same period last year.
Actually, every month in 2017 printed lower growth than the same month last year. This likely indicates price maturity. Price maturity isn’t a crash, but would be a sign of slow growth. In the event that prices reach maturity, a significant macro event would be required to see a boom or crash.
Montreal Real Estate
Montreal might currently be the most over hyped market in the country right now. Headlines have been claiming that the city’s real estate is seeing “explosive” growth. Especially since Toronto and Vancouver implemented foreign buyer taxes. Problem with these articles are they’re notably missing any hard data.
The composite benchmark price of a home in Montreal is up a massive $200 from the month before. Yes, two-hundred dollars – we’re not missing zeros. Compared to the same time last year, prices are up 4.64%, which is good but just a little above inflation. Been hearing the luxury market is growing? It saw 64 sales in August, up from 59 sales the same month last year. These are good, healthy numbers, but let’s not exaggerate – it’s not a market anywhere near overheating.
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