Canadian home prices up 1.0% in February
This increase, unusually large for the season, is attributable to three of the 11 metropolitan markets surveyed: Toronto (+1.9%), Hamilton (+1.4%) and Vancouver (+1.4%). Prices also rose in Ottawa-Gatineau (+0.9%), but declined in all of the other seven markets surveyed: Victoria (-0.1%), Montreal (-0.2%), Edmonton (-0.5%), Winnipeg (-0.5%), Quebec City (-0.9%), Calgary (-1.3%) and Halifax (-1.9%). On a y/y basis, the national index was up 13.4%, the largest 12-month gain since November 2006. This surge was driven by Toronto (a record +23.0%), Hamilton (a record +19.7%), Victoria (+15.9%) and Vancouver (+14.3%). Gains in Ottawa-Gatineau (+5.3%), Montreal (+3.9%), Halifax (+2.6%), Winnipeg (+1.7%) and Calgary (+1.0%) were much smaller. Prices were down from a year earlier in Edmonton (-0.1%) and Quebec City (−1.8%). See charts on next page.
“The strength of 12-month home price growth at the national level is mostly explained by three markets: Toronto,
Hamilton and Victoria (top chart). The Toronto market is especially worrisome. In a city where apartments account for only 26% of home sales, affordability of other types of dwellings has become an acute problem (middle chart). For various reasons, supply (number of listings) on the home resale market is at an historical low, and this surely
contributed to 12-month home price growth exceeding 20% over the last two months for dwellings other than condos.
“Even in that pricy environment, demand for dwellings other than apartments is at a historically high level (bottom chart). In order to accurately assess the Canadian home resale market, it is essential to recognize the dichotomy between markets like Toronto, Hamilton and Victoria, where price growth is in the double digits, and other markets where the progression of home prices has been much more moderate, if not negative.” said Marc Pinsonneault, Senior Economist .