Last Updated on October 24, 2023 by Neil Sharma
The aggregate price of a Canadian home will jump by 16% year-over-year in Q4-2021 amid voracious demand, according to Royal LePage’s House Price Survey.
The aggregate price of a home in the country is expected to reach $771,500 by the last quarter of the year, and while appreciation will slow, demand will remain elevated because foreign students, newcomers and investors will have arrived. In Q2-2021, the aggregate price of a Canadian home jumped by 25.3% year-over-year to $727,000.
Greater Toronto Area
The aggregate price of a home in Canada’s largest metropolitan region increased by 18.2% year-over-year last quarter to $1,035,000, with the single-family detached segment rising by 28.2% to $1,301,000, and condos increasing by 8.6% to $630,000. In the City of Toronto, the aggregate price of a home rose by 8.3% year-over-year in Q2-2021 to $1,115,000, with single-family detached homes increasing by 14.8% to $1,550,000 and condos climbing by 5.8% to $695,000.
Royal LePage attributes the exorbitant valuation increases to a “chronic housing supply shortage,” for which there’s no solution in sight. Although market activity is expected to be slow during the summer, in-person learning in post-secondary institutions, and the renewals of tourism and immigration will conspire to push demand, and by extension prices, skyward. The report anticipates downtown Toronto will return to its pre-pandemic vibrancy, but it also warns that City Council’s intention to raise the municipal land transfer tax for purchases over $2 million could aggravate the shortage of housing inventory.
Royal LePage forecasts the aggregate price of a home in the GTA will rise by 14.5% year-over-year in Q4-2021.
Greater Montreal Area
The second-largest metropolitan area in Canada saw home prices rise by 21.7% last quarter over Q2-2020 to $514,000. Single-family detached homes in Montreal increased by 25.5% in Q2-2021 to $559,000, while condos rose by 14.1% to $405,000. Montreal Centre’s aggregate home price rose by 14.3% year-over-year in Q2-2021 to $643,000, with the median price of a single-family detached home surging by 24.3% to $1,050,000, and the condos increasing by 9.3% to $500,500.
While the rate of appreciation will remain high through 2021, Royal LePage believes prices have already peaked. One reason is, thanks to the spiking COVID-19 vaccination rate, Montrealers have resumed travelling and generally enjoying their summers. The report also stated that prospective first-time homebuyers appear to have taken a break in the hopes that competition won’t be as ferocious in six to 12 months. Royal LePage forecasts that the aggregate price of a home in the region will increase by 17.5% year-over-year in Q4-2021.
Greater Vancouver Area
The aggregate price of a home in Canada’s most expensive metropolitan area rose by 19.6% year-over-year to $1,202,500 in the second quarter of 2021, with single-family detached homes rising by 24.9% to $1,625,000 and condos rising by 9.4% to $700,000. In the City of Vancouver, the aggregate price of a home increased by 11.5% to $1,305,000, with single-family detached homes going up by 14.6% to $2,350,000 and condos climbing by 4.4% to $774,000.
In the metro region, inventory appears to be increasing and demand moderating, although that is likely a confluence of buyer fatigue and people enjoying their summers. Nevertheless, it remains a seller’s market, the report noted, with fierce competition among buyers. Demand is especially strong in the single-family detached market, where move-up buyers are desperately trying to climb the housing ladder.
Royal LePage forecasts that the aggregate price of a home in the Greater Vancouver Area will rise by 15% year-over-year in Q4-2021.
Neil Sharma is the Editor-In-Chief of Canadian Real Estate Wealth and Real Estate Professional. As a journalist, he has covered Canada’s housing market for the Toronto Star, Toronto Sun, National Post, and other publications, specializing in everything from market trends to mortgage and investment advice. He can be reached at neil@crewmedia.ca.
