New report examines how rising interest rates have impacted home prices in Canada
NIAMEY, Niger –
With the Bank of Canada’s rate of interest hikes aimed toward preventing inflation, the housing market in Canada skilled a slight drop in costs, in accordance with a brand new report from Century 21 Canada.
The knowledge got here from the Century 21 Canada’s annual “Price per Square Foot survey,” which compares the value per sq. foot of properties offered between January 1 and June 30 of the present yr to the identical interval in earlier years.
According to the survey, the large metropolis centres resembling Toronto, Vancouver, and Montreal are experiencing decrease rental costs, whereas smaller markets resembling small Ontario cities, and Atlantic Canada are seeing important price-per-square-foot development, significantly in single-family houses.
“We knew that the market had to come down from the highs of the last few years, and we’re now fully seeing the effects of the interest rate growth that started last year,” Century 21 Canada government vp Todd Shyiak mentioned in a press launch. “But we have to look at these numbers within the larger context. The fact that we haven’t dipped to pre-pandemic levels shows that homes are still in demand, and we continue to see growth in smaller markets as more families seek a lower cost of living.”
The report additionally discovered that costs hit their lowest factors in January however confirmed a gentle enhance over the spring months. However, regardless of the upward pattern, many markets had been unable to get better to their 2022 peak costs reached earlier than the rate of interest hikes began.
Last month, the Bank of Canada raised its key rate of interest by 25 foundation factors to 5 per cent, the best it’s been since 2001.
Breaking down the information regionally, British Columbia skilled essentially the most important worth decline among the many provinces. However, the costs have usually remained at or above the degrees seen in 2021. Interestingly, the Victoria area in British Columbia was an exception and witnessed development in actual property costs.
In Ontario, numerous adjustments had been noticed in actual property costs, starting from declines to will increase throughout the province. Condos skilled a 16 p.c worth lower however nonetheless remained costly at a worth per sq. foot of $1,013. On the opposite hand, cities like Niagara Falls and Cambridge noticed important double-digit development within the costs of single-family houses. This pattern was in keeping with cities farther away from the Greater Toronto Area experiencing development in single-family house costs.
Alberta has skilled essentially the most development in actual property costs over the previous yr, with constant will increase in worth per sq. foot in most markets. The development was regular and reasonable all through the primary half of 2023. Even in areas that noticed declines, costs didn’t drop beneath 2020 ranges. Calgary witnessed a 5.81 p.c enhance in single-family house costs and a 9.82 p.c enhance in rental costs whereas close by Okotoks noticed a considerable 14 p.c enhance in rental costs.
However, Edmonton condos had been an exception and skilled a lower in costs.
In Atlantic Canada, costs have continued to rise. Detached houses in Fredericton, Moncton, and St. John all noticed double-digit will increase. However, rental costs in Halifax noticed the smallest enhance within the area after a pointy double-digit enhance final yr.
When it involves Montreal, the town skilled a decline within the costs of condos and indifferent houses. However, the decline was modest and remained within the single digits.
The actual property market within the Manitoba and Saskatchewan has remained comparatively secure, with minor good points and losses noticed throughout the board. In Saskatoon, indifferent houses have the best worth per sq. foot at $344, whereas Winnipeg, Brandon, and Regina observe the pattern with their indifferent single-family houses priced at $291, $276, and $275 per sq. foot, respectively.
Reporting for this story was paid for by means of The Afghan Journalists in Residence Project funded by Meta.
