Seven stats to amaze and depress all who own a house or hope to own
Housing is hot – again. Across the country, in cities big and small, prices are surging after a summer lull. Here are some numbers that document what’s happening
By: Rob Carrick
Hamilton, a steel industry town just to the west of Toronto, is on the verge of joining the club of cities with average resale home prices of $1-million or more.
Toronto and Vancouver could soon have company in the club of cities with average resale home prices of $1-million or more.
Hamilton, a steel industry town just to the west of Toronto, is on the verge along with nearby Burlington. The average resale price for these cities in October was $946,300, up 29.4 per cent from $731,500 in the same month last year. Other prospects for the million-dollar club include the Southern Ontario communities of Cambridge and Guelph, both with average prices in the $825,000 range; and Victoria, where the average resale price last month was $871,000.
18.8 per cent
That’s the year-over-year increase in home prices in the Yukon, where the entire population wouldn’t fill the stadium where the Toronto Blue Jays play, at least in non-pandemic conditions.
The average price Yukon price was $542,515 last month, up almost $86,000 from $456,771 in the same month in 2020. Could this be British Columbia’s rising price trend spreading north? Provincially, the average price increase in B.C. last month was also 18.8 per cent.
In Barrie, the average house price in the past year jumped to $786,500 from $579,400.
In Barrie, roughly an hour’s drive north of Toronto in rarely seen clear traffic, the average house price in the past year jumped to $786,500 from $579,400, a difference of $207,100. That last amount of money would very nearly buy you a typical house in Moose Jaw.
Some numbers on the commute to Toronto from Barrie on GO Transit – 90 minutes each way by train, with a round trip costing around $25 if you buy a Presto fare card instead of paying cash.
1.503 per cent
The yield on the five-year Government of Canada bond hit this mark late at midday Wednesday, which was up from 0.39 per cent at the beginning of the year and a hair’s distance from where it stood before the pandemic. Why you should care: Five-year government bond yields set the trend for fixed mortgage rates.
The Ratehub.ca historical mortgage rate database says discounted five-year fixed mortgage rates were as low as 1.39 per cent at the beginning of the year, which compares with current rates in the 2.35-per-cent to 2.59-per-cent range at national mortgage brokerage companies. Buyers are keeping purchases affordable with variable-rate mortgages, which can be had at rates that are one percentage point and more below fixed five-year rates. With a variable-rate mortgage, you’re subject to every increase coming in the Bank of Canada overnight rate in the next 12 to 18 months.
The federal Liberals made many promises during the recent election campaign to improve housing affordability, including measures to promote construction of affordable housing, curb flipping and discourage buying by foreign investors. At least four additional promises will make it easier to afford the purchase of a house, which is to say they will stimulate demand and prices.
A standout affordability promise is to make mortgage default insurance available for homes valued at $1.25-million, up from the current $1-million, and then index this price to inflation. As a result, buyers in Toronto and Vancouver will be able to put a minimum of 5 per cent down on a home instead of the current 20 per cent minimum applying to homes valued at $1-million or more.
30 per cent
That’s the ballpark level of year-over-year price growth in both New Brunswick and Ontario. An odd partnership has emerged between these two provinces. Ontario’s rising prices are driving residents out of the province to places such as Saint John and Moncton, both of which reported price gains last month of more than 27 per cent.
The New Brunswick benchmark price in October was $267,000, compared with an average price of $912,763 in Ontario. Nationally, resale house prices jumped 18.2 to $716,585.
2.5 per cent
An HR consulting firm called LifeWorks has reported that employers are projecting average annual pay increases next year of around 2.5 per cent. The gap between income and house prices keeps widening.