As a consequence of the Bank of Canada’s rate hikes, the Canadian housing market is on the verge of a cliff, as rapidly rising mortgage rates threaten the stability of Canadian home values. The average home price in Canada was $629,971 in July 2022, a decrease of 5% from the previous year and 5% from the previous month. This is a stunning turnaround from the extraordinary price rises seen earlier in the year, when a new record was reached in February of 2022. Canada’s average home price has decreased for the sixth consecutive month. Compared to the peak of $816,720 in February 2022, the average sales price in Canada has decreased by 23%. In the previous five months, the average Canadian home price has plummeted by 23%, or around $190,000. However, the MLS Benchmark Price continues to increase annually. In July 2022, the national average home price in Canada increased by 7% year-over-year to $782,300, but fell by 3% month-over-month.
The extraordinary increase and drop in Canadian house prices over the last several months can be seen everywhere. The average Ontario home price fell to $831,472 in July 2022. This is a stunning 6% fall from the average home price in Ontario in May 2022 of $881,476. It is also a 23.5% fall from February 2022, when the Ontario housing market reached its high. The annual gain in home prices in Ontario has turned negative, declining 0.5% year-over-year. Compared to the same month last year, sales on the Toronto real estate market plummeted by 48% this month. The average price of a home sold in the Greater Toronto Area increased by 1% year-over-year to $1,074,754 in July 2022. The Greater Toronto Area’s monthly real estate values fell by 6%. Both the Hamilton and Brampton housing markets had a 2% year-over-year increase in average house prices, relative to other Ontario cities. In the last year, the average sold price in Mississauga jumped by 11%, while the average home price in Ottawa rose by 4%.
The Maritimes continue to exceed the rest of the country in terms of benchmark home price growth, with New Brunswick once again leading the way. New Brunswick’s benchmark home prices in July 2022 are $297,600, up 27% year-over-year. Nova Scotia’s benchmark home price has climbed by 23% yearly to $410,700 by July 2022. Halifax-benchmark Dartmouth’s price has climbed by 24% year-over-year to $533,500. The other Atlantic Provinces followed behind but still had strong annual price increases, with Prince Edward Island’s prices growing 18% year-over-year to $374,100, a rare 2% monthly rise, and Newfoundland & Labrador’s prices climbing 10% annually to $284,900. St. John’s saw slower price growth than the rest of the province, with yearly price increases of 8% to $320,400.
Regarding annual home price growth, the Prairie Provinces lagged behind the rest of the country. In July 2022, the average home price in Alberta was $437,028, a 3% year-over-year increase. Calgary’s housing prices have climbed by just 1% yearly, whereas Edmonton’s have increased by 2%. In July 2022, the benchmark price in Saskatchewan climbed by 5% annually, reaching $335,000. Meanwhile, the yearly average home price in Manitoba grew 5.5% to $353,309. That is a substantial monthly decline of 6% for Manitoba home values.
British Columbia is the most expensive province in Canada to buy a home. In July 2022, the average price of a home in British Columbia was $915,841, an increase of 3% year-over-year but a decrease of 3% month-over-month. According to the British Columbia Real Estate Association (BCREA), the average home price in British Columbia in July 2022 was $923,449, a 4% year-over-year rise. This is still more than the average Ontario home price of $831,473. The average property price in Powell River has climbed by 35% annually, whereas the average home price on Vancouver Island has increased by 17% annually.
In July 2022, the average home price in Quebec was $489,259, a 9% rise over the prior year. The average home price in Montreal has climbed by 6% yearly, whereas the average home price in Quebec City has increased by 11% annually. The average Yukon home price has decreased by 4% annually, while the average Northwest Territories home price has increased by 9% annually. Nationally, July 2022 sales are down 21% month-over-month and 28% year-over-year, while the sales-to-new-listings ratio (SNLR) is unchanged at 51.7%. Nonetheless, this is a substantial fall from the SNLR of 57.5% in May 2022 and 66.6% in April 2022. Except for last month, the SNLR is at its lowest level in almost seven years this month. A SNLR over 70% suggests a seller’s market, whilst an SNLR below 40% indicates a buyer’s market.