Post Category: Monthly Reports
February 14, 2018

Toronto index stopped trending down in January

In January the Teranet–National Bank National Composite House Price IndexTM rose 0.3% from the previous month, a tic higher than the historical average for January and a second consecutive monthly increase. However, only four of the 11 metropolitan markets surveyed showed gains – the first time since January 2016 that a rise in the Composite Index has had so little breadth. It was due mainly to a second straight monthly jump of the index for the important Vancouver market (1.2% in January on the heels of 1.3% in December). The Toronto index rose 0.2%, the Victoria index 1.0% and the Montreal index edged up 0.1%. All the other component indexes were down on the month: Hamilton (−0.2%), Ottawa-Gatineau (‑0.2%), Edmonton (−0.3%), Calgary (−0.3%), Halifax (-1.0%), Winnipeg (−1.1%) and Quebec City (−2.0%). For Montreal, it was a 13th monthly increase, and for Hamilton it was a fifth decrease in a row.

The rise of the Toronto index was the first in six months. The raw (unsmoothed) Toronto index [1] on which it is based was up for a third consecutive month. The firming of the smoothed index is due entirely to condo dwellings. The smoothed index for non-condo units fell in January for a sixth straight month, bringing its cumulative decline to 9.6%.

For Vancouver, January was a ninth consecutive month without a decline. The cumulative rise over that period was 14.5% – 18.2% for condo units and 11.4% for all other housing. Vancouver and Montreal were the only markets surveyed whose index reached an all-time high in January.

In January the composite index was up 8.7% from a year earlier, the smallest 12-month rise since May 2016 and a seventh consecutive deceleration from the record 12-month gains of 14.2% last June. The January 12-month rise was led by Vancouver (16.9%), Victoria (12.3%) and Hamilton (9.8%). Toronto’s rise of 8.4% from a year earlier was slightly below the countrywide average. The 12-month advance was below the countrywide average but still respectable for Ottawa-Gatineau (5.6%), Montreal (5.4%), Winnipeg (3.6%) and Halifax (2.5%). It was minimal for Calgary (0.1%) and zero for Edmonton. The Quebec City index was down 1.2% from a year earlier.

Indexes were up from a year earlier for all of 14 markets not included in the countrywide composite index, though the rise ranged widely from 2.8% in Sudbury (Ontario) to 21.4% in Abbotsford-Mission (B.C.).

[1]  Note on methodology: The current-month data used to calculate the index are those of closed sales registered in the provincial land registry. To illustrate the home price trend, the published indexes of the 11 metropolitan markets entering into the Teranet–National Bank Composite House Price Index™ are moving averages of the last three months of raw indexes, a procedure that evens out month-to-month fluctuations. More granular monthly data are available upon request, subject to subscription fees. For our full methodology, please visit www.housepriceindex.ca
Metropolitan area Index Level % change m/m % change y/y From peak Peak date
Report By:

Marc Pinsonneault
Senior Economist
Economics and Strategy Group
National Bank of Canada

The Teranet-National Bank House Price Index™ thanks the author for his special collaboration on this report.

The historical data of the Teranet-National Bank House Price Index™ is available™ at www.housepriceindex.ca.

The Teranet-National Bank House Price Index™ is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index. This is known as the repeat sales method; for a complete description of the methodology, contact us.

The Teranet-National Bank House Price Index™ is an independently developed representation of average home price changes in eleven metropolitan areas: Victoria, Vancouver, Calgary, Edmonton, Winnipeg, Hamilton, Toronto, Ottawa-Gatineau, Montreal, Quebec City, Halifax. The national composite 11 index is the weighted average of the eleven metropolitan areas.

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The Teranet-National Bank House Price Index™ is an independently developed representation of the rate of change of Canadian single-family home prices.  The measurements are based on the property records of public land registries. The monthly indices cover eleven Canadian metropolitan areas: Victoria, Vancouver, Calgary, Edmonton, Winnipeg, Hamilton, Toronto, Ottawa-Gatineau, Montréal, Québec City, Halifax. The metropolitan areas are combined to form a Canadian composite index.

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