The Toronto and Hamilton areas pushed Canada’s home price index to a record high last month while the Vancouver region snapped a three-month skid.
The Teranet-National Bank House Price Index, which tracks the overall changes for various housing types, shows residential prices in 11 major markets climbed 13 per cent in January from a year earlier. It is the sharpest 12-month gain since January, 2007, and the national composite index has now set a new high for 12 consecutive months.
The composite index reached 200.34, meaning home prices as a whole in the 11 major markets have doubled since the base month of June, 2005.
Toronto led the way in year-over-year increases with a 20.9-per-cent surge, followed by Hamilton (17.6 per cent), Victoria (17.1 per cent) and Vancouver (16.4 per cent). There is a big gap beyond the top four markets, with Ottawa-Gatineau’s price index rising 4 per cent for the fifth-highest increase, according to Teranet-National Bank, which looks at pricing trends based on a large sample of the sales of properties registered at land title offices.
The index for the Toronto metropolitan area hit a record of 218.30 last month. “Given that Toronto is a relatively expensive market, house price growth is weighing on affordability for first-time home buyers,” National Bank of Canada senior economist Marc Pinsonneault said in a research note on Tuesday. “This, together with the new rules on qualification for an insured mortgage, should sooner or later take steam out of that market.”
The average price for detached houses, condos, townhouses and other residential properties registered in the Toronto region was $696,282 last month, according to Teranet-National Bank data.
The national index climbed 0.5 per cent last month from December – matching the largest jumps month over month for January (in 2003 and 2010) during the 18-year-old index’s history. The sales price in the national survey averaged $589,795 for the 11 markets last month.
Seven of the 11 metropolitan markets surveyed experienced month-over-month price gains: January increases of 1.1 per cent in Hamilton, 0.8 per cent in Toronto, 0.8 per cent in Montreal, 0.3 per cent in Vancouver, 0.2 per cent in Victoria, 0.1 per cent in Calgary and 0.1 per cent in Quebec City.
Winnipeg, Ottawa and Edmonton had decreases in January from December, while Halifax’s index was flat. The Vancouver region’s price index increased in January, snapping a streak of three consecutive months of declines. The Vancouver area’s index of 243.39 remains by far the highest in Canada and is up 16.4 per cent from January, 2016. The average sales price for various property types was $790,844 last month.
Calgary’s housing market eked out a monthly gain in January, building on increases posted in the previous four months, while Edmonton saw a slight decrease month over month. Year over year, the index in Calgary gained 1.4 per cent and edged up 0.5 per cent in Edmonton.
“Prices in regions such as Calgary and Edmonton, which were hit by the oil shock, continued to recover,” economist David Madani of Capital Economics said in research note. “Over all, the rate of national house price inflation will remain high in the near term, but only because of the investment mania that is bolstering home sales in Toronto.”Report Typo/Error