New Canadian Property Prices Plateau

New Canadian property prices remained unchanged in December, as the Canadian property boom stalled at the end of 2017.

The latest index of new home prices from Statistics Canada showed prices of new Canadian property nationwide failed to rise from the previous month for the first time in nearly three years, since April 2015.

Toronto, Canada’s biggest city and long a driver of Canadian property prices, saw prices ended the year flat – as they have been in six of the last seven months.

The popular surrounding area of Toronto, known as the Golden Horseshoe, also recorded little movement in property prices in December. The area had been experiencing a boom as property buyers were priced out of the city centre.

The provincial government in Ontario intervened with measures to try and cool the property market, including the 15 per cent tax on overseas property investors.

The cooling measures, coupled with two interest-rate increases from the country’s central bank last year that passed through to higher mortgage rates, are thought by Statistics Canada to have contributed to the slowdown according to their report.

The report showed that Vancouver, the other major city that has been driving the Canadian property boom continued to see prices rise. Property prices in Vancouver were up by 0.2 per cent in December, culminating in an 8.9 per cent annual rise during 2017.

Canadian property prices nationwide also recorded a year-on-year rise of 3.3 per cent during 2017, and Toronto helped lead the way despite the stall in December with an annual rise of 4.7 per cent.

With huge annual gains of up to 30 per cent in recent years it was inevitable that Canadian property prices would slow at some point. However, considering that government measures in both Toronto and Vancouver were introduced over a year ago and still no property crash has occurred, it would seem that the Canadian property market is a stable one.

Watch this space for any further developments.