Housing prices in Vancouver climb 26% and in Toronto 15%
The Canadian Real Estate Association (CREA) raised its outlook for home sales this year as the Vancouver and Toronto markets continued to outperform, in stark contrast to other Canadian cities.
In its updated forecast, CREA said, "Many of the defining themes among Canadian housing markets last year have persisted, and in some cases intensified, in early 2016."
Vancouver’s soaring property market has helped push the national average home price in Canada to cross the half-million dollar mark, to C$503,057 for the first time in February. Excluding those two markets, the average price was $355,235, up 8.7 per cent, CREA said.
It now expects sales this year to grow by one per cent against an earlier forecast of a 1.1% contraction.
"Canadian resale housing market trends this year are expected to resemble those apparent in 2015, with very tight supply, leading to strong price gains in British Columbia and Ontario — particularly in the Lower Mainland and in and around the Greater Toronto Area," the forecast said.
"Price gains in these regions are expected to continue to stand in sharp contrast to moderate price declines among housing markets whose prospects are closely tied to oil and other natural resource prices."
B.C. and Ontario are expected to drive the national average price up eight per cent to $478,100 in 2016, according to the forecast.
The revised outlook came as CREA reported home sales in February were up 18.7 per cent from a year ago, driven by sales in Vancouver, Toronto and Montreal.
BMO chief economist Doug Porter said the national figures don't mean much given the big differences between cities; "The Canadian housing market remains a tale of three solitudes:
- The uber-strength in Vancouver and Toronto and surrounding cities in both regions.
- Ice-cold conditions in markets exposed to oil prices.
- And the just-right middle markets in almost every other region.”