Canadian home prices still sluggish
Steve Randall
Canadian Real Estate Wealth
Canadian home prices have lagged inflation over the past year according to a leading index.
The Teranet-National Bank Composite House Price Index gained just 0.44% in the 12 months to July 2019 and gained 0.72% from the previous month. The 12-month increase was the smallest recorded since November 2009.
The Index posted a reading of 226.57, which means that home prices have increased by more than 126% since the base value of 100 was set in June 2005.
The weakness revealed by the index is not universal and the national HPI has been depressed by Vancouver’s index loss of 6.2% over the past 12 months, corresponding to a 12-month string without a gain.
Other Western markets including Victoria, Calgary, Edmonton, and Winnipeg, have also contributed to the weakness. These markets have seen some improvement in sales though recently and this should start to support prices.
For central and eastern parts of Canada, the index has been boosted, but even here the gains posted in the past three months have been weak compared to the 21-year average for these months.
Vancouver was the only metropolitan area surveyed whose run of monthly declines continued in July. Indexes for the other 10 markets of the composite index were all up on the month: Quebec City 0.1%, Edmonton 0.5%, Victoria 0.6%, Calgary 0.7%, Toronto 1.3%, Hamilton 1.3%, Halifax 1.6%, Montreal 1.7%, Ottawa-Gatineau 2.0% and Winnipeg 2.9%.
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