Reported provincial real estate numbers are dizzying… one month they’re up, the next month they’re down. One month they’re hot, the next, they’re cold – you get the idea. Then consider the recent rule changes to mortgages as per both CMHC and FSCO guidelines and you’re on one heck of a ride! Let’s take a look at a few of the so-called hottest markets and most recent numbers released by each respective real estate board to see what’s really going on.
Vancouver, BC: Correcting The Mighty Mountain
Not so hot any more… on a month-over-month and year-over-year basis, both prices and sales have dropped in Vancouver, long touted as Canada’s priciest market. Residential property sales hit a 10-year low last month while prices were moderately affected. Vancouver has been slowing down for a few months now as the market begins to favour buyers.
Status: A correction is upon Vancouver, as sales have cooled off dramatically and it seems as though prices may begin to follow suit.
Edmonton, AB: Balanced and Affordable
June was a bit of a slower month for Edmonton as sales were down and average prices were down as well. However, Edmonton appears to be growing which can be seen in an improvement their home sales and prices on a year-over-year basis.
Status: Edmonton seems to remain a quite balanced and affordable market – someone in Canada’s gotta be!
Toronto, ON: The Hardest Hit
June usually has the highest level of reported sales in Toronto, but this June saw the lowest sales recorded since 2000 – so what’s going on? From last month, sales are down over 13 per cent and prices have decreased moderately. Since last June, average sales are down while average prices have actually increased. Although not shown here, the condo market in Toronto has been hit the hardest, sales in the 416 are down 18 per cent from last year where as condos in the 905 market have dropped nearly 20 per cent.
Status: When you consider the distinctive drop in sales both month-over-month and year-over-year in Toronto, paired with the fact that the condo market (aka the hottest market) is taking the biggest hit, it is fair to assume that Toronto should begin to realize an adjustment in prices and mellow out.
Montreal, QC: A Buyer’s Market?
Prices haven’t moved around too much since last June, nor has Montreal seen much of a change since May either. Year over year, sales are holding quite steady as well. Where we have seen a notable change is the large drop in sales over the last month! Monthly sales in June dropped by a whopping 25 per cent!
Status: This market may turn into a buyer’s market in order to improve the sales numbers. Clearly there has been a significant decrease in monthly sales and if this problem persists the only solution will be to drop prices and directly improve the sales figures.
The National Impact
The national average house price dropped 2 per cent since last year in Q1. Last month, Scotiabank released a report on Global Real Estate Trends which shows that the number of national sales has been steadily increasing since 2010 however the prices are beginning to adjust. The average price of a home in Canada increased by over $18,000 from 2009 to 2010, and then from 2010 to 2011 the average price rose by $24,297. Year-to-date for 2012, the average price has only increased just slightly over $5,000.
Status: It seems as though prices were already beginning to adjust before the new announcement made by Jim Flaherty came into play, however these new rules are really going to be felt the most by first time home buyers and those looking to be approved by CMHC for default insurance. Overall the market seems to be relaxing, but remaining strong.