Residential Market Commentary - week of May 22, 2017
May 23, 2017, 10:42 AM
The latest home sales stats from both the Canadian Real Estate Association and Teranet show prices are continuing their quick march upwards. While that remains troubling for policy makers there is evidence undue price acceleration is spreading.
Toronto and Vancouver still lead the way, dragging the average for the rest of the country along with them. The national numbers from CREA show a 20% increase y/y in April, with Toronto registering a 30% jump. Vancouver saw an 11% rise. The CREA survey shows price increases in 11 of the 13 markets in tracks across the country.
The Teranet figures show a 13.5% increase nationally, compared to last April. Toronto clocks-in with a 25% jump and Vancouver shows a 12% rise.
Some new concerns are being raised about the spread of this kind of price acceleration into markets that are ever farther away from the two, big hot-spots. While the effects are well known for communities close in, a new report from Canada Mortgage and Housing shows the long-term spillover can spread for hundreds of kilometres – well beyond commuting distance. The report estimates that over the last five years, or so, prices in Vancouver have pushed up costs in Kelowna – more than 400 kilometres to the east – by about a 0.5%. In the case of Toronto, price acceleration is already picking up as far away as Kitchener-Waterloo, some 100 kilometres to the west.