Canada housing market update - September 2021

In this article, we dissect the latest data from The Canadian Real Estate Associate (CREA). Per CREA, the MLS Home Price Index (HPI) is the most advanced and accurate tool to gauge home price levels and trends. If you wish to explore these charts and data on your own, you can use our interactive home price analysis tool. The national benchmark price was $747,700 in September 2021, representing a month-over-month gain of 1.3% and a year-over-year gain of 21.5%.


In the above chart, we look at the national benchmark home price since 2005. We have overlayed a trend line using a simple linear regression, which allows us to see how prices compare to the normalized historical price growth.


This chart shows the benchmark home prices for some of the major cities in Canada. We can see that Greater Toronto experienced the sharpest price acceleration in September, while Ottawa and Calgary saw prices decline slightly.


Back in July, prices had been decelerating for five consecutive months and it looked like buyers might finally get some relief. However, national home prices are accelerating yet again, reaching the fastest pace since May. This now marks 17 consecutive months of price growth.


Taking a look at the top ten fastest-growing cities in September, we see a mix of smaller and larger cities. To give further context to these numbers, Cambridge's monthly growth of 4.1% would end up being 62.0% over 12-months. On the opposite end, 11 cities out of the 47 tracked by CREA saw prices decline from August to September.


Final thoughts

CREA reported that the months of inventory metric has declined again, which was likely the key driver of the September price acceleration. There are currently 2.1 months of inventory nationally, and this needs to get up to 5.0 to shift to a more balanced market.


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