According to June’s Teranet-National Bank House Price Index released today, Canadian home prices were up 13.6% from a year earlier. The 12-month gain of 13.6% was identical to that of May and was strongly influenced by Vancouver, up 16.3%, and Toronto, up 16.2%. In the other 4 markets surveyed, the year-over-year rise ranged from 7.1% in Halifax to 12.0% in Ottawa.
June marked the 3rd consecutive month that prices were up from the month before in all 6 cities in the index. Month-over-month, the index rose 1.5%, the largest increase since last August. For the composite index it was the 14th straight monthly increase, the longest such run since October 2006.
In Calgary, house prices were up 0.2% from May, and up 8.3% from the previous June. Year-to-date, prices are up 0.97%.
Source: Teranet National Bank
From the report:
Since the resale market has been slackening across Canada – from April to July of this year, more existing homes came on the market than were sold – it is too early to conclude that the relatively vigorous prices rises of April, May and June launched a trend. The prospect of harmonized sales taxes coming into effect July 1 in Ontario and B.C. may have stimulated sales in Vancouver, Toronto and Ottawa in the preceding months.
I don’t mean to be a statistical stickler, it’s just my nature.
Those were the SFH numbers that were quoted. Are fewer million dollar sales contributing to driving down the average price? Actually, the percentage of million dollar sales to total sold is higher this year than last. As well, the average price of those million dollar sales are actually higher this year as well. June 2010 and June 2009 also had the same amount of $1M+ sales while July had a difference of 4.
June 2009
Million dollar + Sales: 38
Total Sales: 1837
Average Price: $447,142
2.07% ($1M+ to total sales)
Average Price of $1M+ sales: $1,338,478
June 2010
Million dollar + sales: 38
Total Sales: 1061
Average Price: $481,964
3.58% ($1M+ to total sales)
Average Price of $1M+ sales: $1,430,315
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July 2009
Million dollar + sales: 34
Total Sales: 1585
Average Price: $436,782
2.15% ($1M+ to total sales)
Average Price of $1M+ sales: $1,339,000
July 2010
Million dollar + sales: 30
Total Sales: 915
Average price: $464,655
3.28% ($1M+ to total sales)
Average Price of $1M+ sales: $1,572,950
I’ll be able to comment on August 1-25 more precisely at the end of the day when all the sales have been entered into our system.
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Edit: Below are the August month-to-date figures:
August 1-25, 2009
Million dollar + sales: 26
Total Sales: 1025
Average Price: $459,326
2.54% ($1M + to total sales)
Average Price of $1M+ sales: $1,792,202 (Note: that’s when the $10.3M property sold)
August 1-25, 2010
Million dollar + sales: 19
Total Sales: 688
Average Price: $440,721
2.76% ($1M + to total sales)
Average Price of $1M+ sales: $1,282,789
For this month, the % of $1M+ sales to total sales is fairly close between the 2 years. The fact that the record $10.3M property sold also bolsters August 2009`s average price.
If your eyes glazed over from boredom looking at the numbers (
), here`s a quick summary:
June & July 2010 average prices were actually strengthened because of the luxury segment when compared to 2009, meaning that can`t be used as an excuse for declining average prices. However, month-to-date, million dollar sales had a greater impact to the average price last August compared to this one.
Awesome work Mike! I’m not sure what is worse, the crap that real estate boards try to pass through the media or the fact that the media never bothers to question what they’re fed before they pass it on to the public.
I believe that there are less and less people walking around with $1,000,000 dollars in their pocket OR want to get a hugely massive mortgage for an asset that is seen more and more as “risky” rather than “safe”.
Here is a question for you Mike… If $1m+ home sales are down, how are sales of $400 or less doing % wise vs $1m+?
CanuckDownUnder, thanks for your comment. How is real estate looking like in Australia right now?
Mike, $1M+ home sales are down from 2009 for just the months of July & August. Year-to-date, there have been 236 $1M+ SFHs sold compared to 192 during the same time period last year.
In any case, luxury sales aren`t closely linked to the rest of the market: Is the Luxury Segment Reflective of True Market Conditions?
After living in Sydney for the past couple of years I now think Calgary looks really cheap!
The market here is like Canada on steroids, most places have seen prices go up 200-300% since 2000. I guess Sydney went crazy from 2000-2003 and then went flat for about 5 years before record low interest rates and government grants started pushing the market up again.
Supposedly things have quieted down the last couple of months but the average sale price here is just over $600,000 Aussie (roughly $550,000). That includes houses and apartments, not sure what the breakdown looks like.
CanuckDownUnder, I didn`t realize how inflated the market was there in Australia.
Morgan Stanley has serious concerns about Australian RE, but it looks like money can be made off it. You can read the whole article at Bloomberg.
Mike – The Economist suggests prices are overvalued by 60% based on long term rent-price ratios.
The driver of the economy here has been China’s insatiable appetite for iron ore and coal which has kept Australia out of recession. If China falters the Aussies are in big trouble economically.