Canadian house prices growth over the last 5 years

If you are planning a move to Canada, one of the questions that are likely to be at the front of your mind is understanding how home prices have varied over the last 5 years. Knowing what price ranges will get you into homes that fit your needs in great neighborhoods can give you some idea of what might be coming down the pike for you.

Canadian house prices continue to rise, with price growth particularly strong in the country’s most populous metro areas. Price growth has been much slower outside these areas and in most regions, it’s been balanced, which is generally a sign of a healthy housing market.

Canada House Price History

Prices in booming Alberta surpassed those in Ontario for the first time in 2007, and prices in Calgary surpassed those in Toronto.

  • By 2011, the situation had flipped, and homes in Toronto and Ontario were once again more expensive than those in Calgary and Alberta.
  • House price increases in Canada were modest in 2011 and 2012, owing in part to the implementation of new, stricter mortgage rules. In Vancouver and Toronto, house prices rose steadily in 2013 and 2014.
  • House prices in British Columbia and Ontario continued to rise above the national average in 2015 and 2016. After falling in 2015, Alberta house prices are relatively stable in 2016.
  • In 2017, house sales in Canada fell, and prices in the majority of provinces stabilized.
  • In 2018, a 20% down payment rule went into effect, and a stress test for mortgage applications is now in place.

In Toronto and Ottawa, house prices increased by more than 10% between April 2019 and April 2020. In 2020, Vancouver has the most expensive city average property price.

Canadian Cities Average House Prices April 2020

Canadian Provinces Average House Prices April 2020

Canada’s Provinces Compared

Canada remains a country to which immigrants flock because wages are still comparatively higher than in most countries, and house prices are lower. However, the gap has narrowed. Notable increases in house prices in Vancouver and Toronto – the only two cities in Canada where most people can both earn enough to meet their daily needs and save for retirement – have changed the picture since the good old days.

Canadian house affordability, a gauge that compares the price of a typical house in Canada with the average annual incomes of people in each area, has seen some major changes in recent years. Although this article doesn’t cover every province, it does provide some general comparisons so that you can discover which provinces offer the most favourable housing affordability.

House affordability has improved in most parts of Canada in recent years, though in British Columbia and Ontario, respectively, more than thirteen and eleven years of gross average wage are required to purchase the average property.

Despite this, several Canadian provinces continue to have some of the lowest property prices in the Western world. New Brunswick has the most affordable housing relative to gross wages, followed by Newfoundland and Labrador, and Saskatchewan.

The higher the ranking in the table below, the more expensive housing is in comparison to wages.

Canadian House Affordability 2020

(Affordability is measured by the number of years of gross average wage needed to buy an average house.)

Demand is still on the rise. According to Canadian Real Estate Association  (CREA) Statistical Report for 2020, actual sales increased 47.2 percent from the previous year in December 2020, the largest year-on-year increase in 11 years. Total sales for the entire year of 2020 reached a new high of 551,392 units, up 12.6 percent from the previous year and about 2.3 percent higher than the previous peak set in 2016.

Residential construction activity increased last year as well. According to the Canada Mortgage and Housing Corporation (CMHC), dwelling starts increased by 4.4 percent to 217,802 units in 2020, following declines of 2% in 2019 and 3.1 percent in 2018. Similarly, dwelling completions increased by 6.1 percent year on year to 198,636 units last year. However, due to the greater increase in sales versus new supply, the national sales-to-new listings ratio tightened to 77.4 percent, a sharp increase from the long-term average of 54.2 percent and among the highest on record.

“Recent national sales trends have improved more than anticipated over the second half of 2020. New listings in most of the country have also recovered,” said the Canadian Real Estate Association (CREA).

“However, while sales activity rebounded to record highs, new listings in most markets only recovered to about their five-year average.” Because of the relative strength of demand for homes versus supply, sales activity has been eroding active inventory, which was already scarce in many markets prior to the pandemic. Having said that, this has been a trend since 2015.”

The national average home price stood at CA$ 568,758 (US$446,947) in 2020, up 13.1% from a year earlier, according to CREA. British Columbia and Ontario had the most expensive housing markets in the country, with average prices of CA$ 778,012 (US$ 611,385) and CA$ 708,377 (US$ 556,664), respectively.

About the author 

Filip Hajduk

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}
Subscribe to get the latest updates