In February the Teranet–National Bank National Composite House Price Index(tm) retreated 0.1% from the previous month, following December and January rises that had interrupted a downtrend. It was the first February decline since 2013. The index was up in only three of the 11 metropolitan markets surveyed, the fewest since October 2014: Vancouver (+0.4%), Hamilton (+0.2%) and Halifax (+0.8%). The index for Victoria was flat on the month and the other seven component indexes were down: Toronto −0.1%, Montreal −0.3%, Ottawa-Gatineau −0.7%, Edmonton −0.8%, Calgary −0.8%, Winnipeg −1.0%, Quebec City −1.5%.
For Vancouver it was the 12th rise in 14 months, taking its index to a new record. However, this market’s raw (unsmoothed) index* was down 1.3% on the month, a retreat coinciding with a cooling of home sales as reported by the Real Estate Board of Greater Vancouver. The raw index for Toronto declined after three consecutive rises. In previous months observers had noted a certain haste on the part of buyers to beat the entry into effect of tougher conditions for obtaining an uninsured mortgage. The advance of the Hamilton index interrupted a run of five declines. The retreat of the Montreal index was the first in 14 months. This is not a concern, since the Greater Montréal Real Estate Board reported the strongest sales in six years for the first two months of a year.
- Composite 11
- All Metropolitan Indices
- British Columbia
- New Brunswick
- Nova Scotia
The composite index in February was up 7.5% from a year earlier, the smallest 12-month rise since March 2016 and an eighth consecutive deceleration from last June’s record 12-month gain of 14.2%. The February 12-month rise was led by Vancouver (15.8%), Victoria (12.4%) and Hamilton (8.4%). It was below the countrywide average but still respectable in Toronto (6.2%), Halifax (5.3%), Montreal (5.0%), Ottawa-Gatineau (3.7%) and Winnipeg (3.0%). For Calgary it was a minimal 0.6%. There were declines from a year earlier in the indexes for Edmonton (−0.3%) and Quebec City (−2.3%).
Of the 14 markets not included in the countrywide composite index, indexes for seven were down from the previous month. Indexes for all 14 were up from a year earlier, with rises ranging from 1.2% in Sudbury, Ontario, to 23.9% in Abbotsford-Mission, B.C.
*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
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Economics and Strategy Group
National Bank of Canada