Post Category: Monthly Reports
May 19, 2021
An even bigger jump in home prices in April

In April the Teranet–National Bank National Composite House Price IndexTM was up 2.4% from the previous month, a marked acceleration even from the March increase of 1.5%. The advance was led by five of the 11 constituent markets: Halifax (5.4%), Toronto (3.0%), Victoria (2.8%), Ottawa-Gatineau (2.8%) and Hamilton (2.8%). Rises were more moderate for Vancouver […]

Post Category: News and Press Releases
May 19, 2021
Home prices continue their relentless advance in April

The Teranet-National Bank HPI jumped 2.4% in April to a new all-time high. This marks 18 straight monthly increases. Its recent vigour coincides with historically high numbers of home sales in most regions of Canada, coupled with limited supply. As such, market conditions remain very much in favour of sellers and consequently price growth. After seasonal adjustment the monthly jump of the unsmoothed HPI was slightly weaker – 2.0%, bringing the unsmoothed index to a whopping cumulative gain of 14.3% since last June (left chart). The rapid pace of home price growth continues in the great majority of large Canadian cities, with prices up 10% or more from a year earlier in an unprecedented 87% of the 32 urban markets surveyed (right chart). It should be noted that annual price growth for single-family homes continues to outpace the condo segment. The latter continues to lag as the shift of preferences has tilted buyers from small dwellings in city centers to larger homes in the suburbs. This divergence may not last for long as mortgage interest rates have increased, and affordability has deteriorated in the non-condo segment (link).

May 2021

Post Category: Monthly Reports
April 20, 2021
Big jump in home prices in March

In March the Teranet–National Bank National Composite House Price IndexTM was up 1.5% from the previous month, a sharp acceleration from the February increase of 0.5%. The advance was led by three of the 11 constituent markets: Halifax (3.3%), Hamilton (2.8%) and Toronto (1.9%). The rise for Vancouver matched the 1.5% of the composite index. […]

Post Category: News and Press Releases
April 20, 2021
Big jump in home prices in March

The Teranet-National Bank HPI jumped 1.5% to a new high in March, its 17th straight monthly rise. Its recent vigour coincides with historically high numbers of home sales in most regions of Canada, coupled with limited supply. The monthly jump of the unsmoothed HPI was even bigger – 2.7%, the most of any month since July 2006, taking the unsmoothed index to a cumulative rise of 11.9% since last June. The rapid rise of home prices continues in the great majority of large Canadian cities, with prices up 10% or more from a year earlier in an unprecedented 81% of the 32 urban markets surveyed. However, the magnitude of the price rise varies with category of dwelling. In the main metropolitan markets the rise was much smaller for the condo segment than for single-family homes. Among the reasons for the difference is a shift of preferences away from small dwellings in city centres toward larger homes in suburbs.

April 2021

Post Category: Monthly Reports
March 17, 2021
Home prices accelerate in February

In February the Teranet–National Bank National Composite House Price IndexTM was up 0.5% from the previous month, an acceleration from the January increase after three consecutive months of slowing. The advance was led by four of the 11 constituent markets: Halifax (2.3%), Hamilton (1.1%), Vancouver (0.8%) and Quebec City (0.7%). Rises of less than the […]

Post Category: News and Press Releases
March 17, 2021
Home prices up in February for a 16th straight month

The Teranet-National Bank HPI rose to a new high in February. Its 0.5% gain from January was its 16th consecutive monthly rise. This recent vigour coincides with historically high numbers of home sales in most regions of Canada, coupled with limited supply. As a result, prices were up 10% or more from a year earlier in an unprecedented 77% of the 32 urban markets covered. However, the magnitude of the price rise varies with the category of dwelling. In the largest metropolitan markets, the rise was much smaller for the condo segment than for single-family homes. Among the reasons for this difference is a shift of preferences away from small dwellings in city centres toward larger homes in suburbs. Apart from the pandemic factor, there is reason to believe the condo segment is feeling the effect of low immigration inflows and persistently high unemployment among young workers.

March 2021

Post Category: News and Press Releases
February 18, 2021
Home prices at a new peak in January

The Teranet-National Bank HPI rose 0.3% in January, reaching an all-time high. The new record coincides with a historically high volume of home sales in most regions of Canada, coupled with limited supply. The seasonally adjusted unsmoothed Composite HPI has surged 7.8% since July. However, the uptrend of home prices does not encompass all categories of dwellings. In Toronto, the rise in sales volume was concentrated in single-family dwellings outside the downtown area, and did not take in condos. In the Greater Montreal market, a very large rise in condo listings on Montreal Island contrasts sharply with the peripheral areas of that market. In the Greater Vancouver and Victoria markets, as in Toronto and Montreal, price increases for single-family homes have significantly outpaced those for condos. Apart from a shift in preference induced by the pandemic, there is reason to believe the condo segment is affected by low immigration inflows and a persistently high unemployment rate among young workers.

February 2021

Post Category: Monthly Reports
February 18, 2021
Index growth slows further in January

In January the Teranet–National Bank National Composite House Price IndexTM was up 0.3% from the previous month. It was the third consecutive month in which the index rose less than the month before. The increase was led by five of the 11 constituent markets: Hamilton (2.0%), Montreal (1.0%), Victoria (0.6%), Halifax (0.4%) and Vancouver (0.4%). […]

Post Category: Research
February 04, 2021
Rising home prices posing a challenge for affordability

Housing affordability in Canada improved in the fourth quarter of 2020, marking a third amelioration in a row. That said, the improvement this quarter was much less impressive. Higher incomes and record low interest rates were almost completely offset by a substantial rise in home prices. Indeed, prices for the national composite rose 4.5% in the quarter, the highest quarterly gain in 11 years. While a 29 basis points decline in our 5-year benchmark mortgage rate has helped keep housing affordable this quarter, the nearly 100 basis points decline for rates since the start of the pandemic is surely propulsion for the current appreciation in home prices. Although the confluence of all these factors has resulted in home affordability having never been better since 2015, there is another hurdle for potential homebuyers. The rise in home prices has translated into a higher down payment. At a national level, there has never been a worse time to accumulate the minimum down payment. Assuming a savings rate of 10% of total median household income, it would now take 60 months (5 years) to save for the minimum down payment (approximately 6%) on the representative home. Still, with interest rates unlikely to rise soon, vaccine rollout ushering a return to normal and market conditions in favour of sellers, home prices are on track to keep growing in 2021. As a result, affordability is likely to
deteriorate on both a mortgage payment as a percentage of income and down payment basis going forward.

Read research report

Post Category: News and Press Releases
January 20, 2021
Home prices continued to rise in December

The Teranet-National Bank HPI rose 0.6% to a new high in December. This record coincides with a historically high volume of home sales in most regions of Canada coupled with limited supply. The seasonally adjust unsmoothed Composite HPI has surged 6.8% since July. However, December was the second consecutive month in which index growth was slower than the month before. Moreover, the uptrend of prices did not apply to all categories of dwellings. In Toronto, the rise in sales volume was concentrated in single-family dwellings outside the downtown, not in condos. In the Greater Montreal market, a very large rise in condo listings on Montreal Island contrasted sharply with the peripheral areas of that market. In Greater Vancouver and Victoria, price increases for single-family homes also far outpaced those for condos. Apart from a shift in preference induced by the pandemic, there is reason to think the condo segment is affected by low immigration inflows and a still-high unemployment rate among young workers.

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For further information about upcoming reports, please contact:

Kan Zhu
Leader, Data & Advisory Solutions
Teranet Inc.
Phone: 416-360-8863 x 2270
Email:
Michael Pertsis
Director, Mortgage Derivatives
National Bank Financial
Phone: 416.869.7124
Email: