In June the Teranet-National Bank HPI was up 16.0% from a year earlier, the largest 12-month gain on record. The record is the more impressive for beating the 14.2% rise of June 2017, which preceded the coming into effect of macroprudential measures to restrain home prices. At that time the price rises were concentrated in the markets of Vancouver and the Golden Horseshoe region including Toronto and Hamilton. This month’s new record is based on countrywide rises across the regions covered by the index. Prices were up 10% or more in an unprecedented 90% of the 32 urban markets for which an index exists and 30% or more in an equally unprecedented 42% of these markets. The June monthly gain of 2.7% in the national composite index was its 20th consecutive monthly rise and the second largest since the beginning of the index in 1999. However, it was the first deceleration from the month before (May rise 2.8%) since January. This cooling coincides with a slowing of growth in existing home sales – their number declined in June for a third straight month. The moderation of the pace of sales could mean a slowing of price rises in the coming months. However, since the market remains vigorous by historical standards, we do not anticipate a decline of prices in the near term.

July 2021