Canadian house prices rose by a record 26.6 percent in 2021

As Canada enters the third year of COVID-19, the underlying conditions of the housing market remain largely the same as they have been since the beginning of the pandemic.Justin Tang / The Canadian Press

Canada’s housing market ended the second year of the pandemic with record high prices in price growth and housing values, suggesting that the country’s problem of affordable housing now extends beyond major metropolitan areas and into smaller cities.

The typical price of a nationwide home rose 26.6 percent in December from a year earlier – the fastest pace ever – reaching a new high of $ 811,700 according to the Canadian Real Estate Association’s house price index, which adjusts for price fluctuations. .

Typical housing prices in the Toronto region are well over $ 1 million, and many cities in southern Ontario have reached $ 800,000. In less populated regions like Chilliwack, in British Columbia and Cambridge and Brantford in Ontario, the house price index has risen by about 40 percent, with the typical value of a property at least $ 200,000 higher than a year ago.

Eight charts that provide insight into the housing market for the coming year

As the country enters the third year of COVID-19 crisis, the underlying conditions of the housing market remain largely the same as they have been since the beginning of the pandemic: borrowing costs are close to zero, there is high demand from home residents and there is a shortage of houses for sale.

There are now 1.6 months of housing stock left across the country, provided the sales pace remains the same as it was in December. The shortage of properties on the market continued, even after more homeowners put their homes up for sale last year compared to 2020.

“There are currently fewer properties for sale in Canada than at any one time registered,” Shaun Cathcart, CREA’s senior economist, said in a press release. “The problem of affordability that the country is facing is likely to get worse before it gets better.”

Across the country, there were 666,995 home sales last year. It was 20 percent higher than the previous record for resale, according to CREA – and the previous record was set in 2020.

In the first few weeks of this year, real estate agents have described a hectic market, even when buyers and sellers trade with the latest measures to stay at home and other pandemic-related restrictions.

“I see no end to the demand side as there seems to be more buyers for every listing that goes up and rural areas are also affected,” said Donna Harding, a broker at Engel & Volkers, which has sold homes in the Halifax region for almost two decades.

Ms. Harding said she has seen constant investor demand for rental housing.

In the Toronto region, homes continue to sell well above listed prices. The region’s house price index rose by 31 per cent in December compared with the previous year.

“2021 demand has continued until 2022,” said Cailey Heaps, who has been selling homes in Toronto for more than two decades. Within the first two weeks of this year, one of her clients’ homes had 54 views. It drew six bids and sold $ 500,000 compared to asking for $ 2.7 million.

Canadian house prices hit record highs in November

It is not only Toronto that has experienced a decline in prices. In Ontario’s cottage country, house prices have nearly doubled in two years, according to CREA data.

In Oakville, the house price index has risen by $ 550,000 since December 2019. In other cities in southern Ontario, the house price index has risen by at least $ 300,000 over the same period. It includes Hamilton, Guelph, Kitchener, Cambridge, Brantford and Mississauga.

Not much has been done to curb demand. Despite stricter eligibility requirements for mortgages passed in mid-2021, Canadian residents continue to take out large home loans. CREA, other real estate industry groups, the federal housing agency, and some economists have all said the problem is the lack of housing supply, not demand.

Your time is valuable. Get the Top Business Headlines newsletter conveniently delivered to your inbox tomorrow or evening. Sign up today.


Give a Comment