New report shows cooling markets across Canada

February marked the fourth straight deceleration of the country’s housing price index, an early sign of cooling housing markets across the country, despite a 4.4 per cent increase over the same period last year.

“There were 12-month gains well above the countrywide average in Hamilton, Toronto, Vancouver and Calgary, gains close to the average in Edmonton and Victoria, and a small gain in Halifax,” Teranet-National Bank wrote in its latest report.

“Prices in Quebec City were flat from a year earlier. Prices were down from a year earlier in Winnipeg, Ottawa-Gatineau and Montreal.”
The February housing price index (HPI), which measures the change in price for resale single-family homes, rose 7.3 per cent in Toronto over the year, 5.7 per cent in Vancouver and eight per cent in Hamilton.
Surprisingly, though, Calgary also posted a 5.6 per cent year-over-year rise in HPI last month, likely a result of the Bank of Canada’s decision to lower the overnight rate in January – a it hoped would prop up the market in Calgary, which many thought would falter in light of sliding oil values.
Compared to January, however, Calgary’s HPI was down 0.3 per cent, marking its fourth straight decline.
That decline, compounded by month-over-month decreases of 0.1 per cent in Toronto, 0.8 per cent in Edmonton, 2.1 per cent in Ottawa-Gatineau, and one per cent in Winnipeg, pulled down the national HPI, though it still managed to rise 0.1 per cent over January.
Vancouver, Victoria and Hamilton posted a 1.5 per cent, a 0.5 per cent and a 0.3 per cent month-over-month increase, respectively. Still, the modest month-over-month growth in just three cities further points to cooling markets across the country.
“However, prices rose in only three of the 11 metropolitan markets surveyed, even fewer than the five markets that showed gains in January,” Teranet-National Bank said. “In some markets there have clearly been corrections in progress.
“The monthly retreat in Calgary was the fourth in a row, for a cumulative decline of 2.3 per cent. In Winnipeg it was the fourth [decline] in five months, for a cumulative decline three per cent. East of Toronto the corrections have tended to be larger.”

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  • by Neil Murphy 2015-03-14 11:15:01 AM

    About your comments on Calgary still having a good month in February but falling off a bit from January, Ben Myers states in The Market Manuscript....

    "In October, Calgary was ranked as the top real estate market to watch for 2015. That optimism has faded, with many housing experts now calling for balanced market conditions in the metropolitan area. Demand clearly exceeded supply in late stages of 2014 in the Calgary CMA. The cooling effect on homebuyer demand that is expected in 2015 will contribute to a re-balancing of the demand-supply equation for the CMA in the first half of the year. It is expected that Calgary will move from a seller’s market to a more balanced market."

    This is from our report on Canadian Real Estate by Ben Myers, you can get a free copy here...

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