A report in the Globe and Mail shows the average Canadian home now costs slightly more than a year ago, at $375,810. According to figures from the Canadian Real Estate Association, prices are 0.9% higher than a year ago, and prices are up in 80% of markets throughout the country.
The price rise is not exactly substantial, but economists are still worried about the possibility of a correction in the housing market, especially in markets where prices are continuing to rise rapidly. Mark Carney, the governor of the Bank of Canada has already warned that household debt is the main domestic risk to the economy.
In Vancouver, the property market is cooling down rapidly, and there is downward pressure on prices. If Vancouver is taken out of the equation then property prices are 4.9% up on a year ago. However prices in Toronto are still increasing at a rapid pace, and if Toronto is taken out of the equation then prices would have actually declined by 2.2% over the past year. Taking out both of these major cities then prices would show a 3.1% increase.
Toronto isn’t the only city where prices are still increasing, as prices in Newfoundland and Labrador are up by 12%, by 9.4% in Regina, by 9% in Saguenay, and by 8.5% in Thunder Bay. In comparison prices in Victoria are down by 3.6%, and prices are down by 3.2% in Saint John, by 1.9% in Vancouver, by 1.4% in Fraser Valley, and by 0.2% in Sherbrooke in Québec.
Although the average cost only increased slightly, sales in April were 11.5% higher than the same month a year ago, although this is thought to be partially due to the fact that new mortgage rules were introduced in April 2011. Some 157,804 homes have been sold in Canada so far this year, and this is an increase of 6.4% compared to the same period last year.