Acceleration in House Prices Not as Bad as It Seems

Property prices in Canada have gone up by 15% in one year.  At first glance, this increase is outrageous.  But, as most people are aware, the vast majority of this increase can be attributed solely to the soaring house prices in Vancouver and Toronto.

What you may not know, is that the average residential prices have risen by only 0 – 3% in the other major Canadian cities, and that some cities have even shown a decrease in prices.  Here is a complete breakdown for each city (statistics are from May 2015 and May 2016):

Vancouver +22%

Toronto +15%

Montreal  +3%

Winnipeg +2%

Calgary +1%

Halifax  0%

Ottawa 0%

Edmonton  -1%

Quebec  -1%

(Sources: CREA and QFREB)

Granted, one can still argue that our beautiful city of Montreal has the third highest rate of increase in all of Canada, or one could argue that the increase is more than twice the 2015 inflation rate (1.15%).  However, the prices are beginning to decrease very gradually in some sectors of the city, so we may see that 3% figure slowly coming down over the next few months.  The national figure should normalize as well, now that the cities of Toronto and Vancouver are looking at local measures to curb price momentum.

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