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Canadian Markets With the Largest Home Price Increases

Welcome to Living in Ottawa. If you’re living in Canada or moving to Canada and you’re looking for a home, you already know that prices are high. Over the past two years, we’ve seen explosive increases in real estate prices across the country. We are going to cover the Canadian Markets With the Largest Home Price Increases.

But, hey, it’s a big country. So it makes a lot of sense that some areas have seen greater home price increases than others. Today we’re going to talk about the areas that have seen the steepest price growth.

We’re going to look at these increases in two ways. The first is areas that saw the steepest growth in a single month, from November to December of 2021. The second is growth over the entire year.

We usually talk in percentages, but today we’re going to talk in dollars. Percentages are valuable from a market perspective, but dollars show us exactly how much homebuyers are seeing prices go up, even in a single month.

When we look at these numbers, it’s even easier to understand buyer fatigue and frustration as people try to buy homes in and around some of Canada’s major cities.

Top Five in One Month

We’ll start by counting up from the fifth spot to the first spot in single-month price growth. It probably won’t come as much of a surprise that all five areas are in either Ontario or British Columbia.

Home to Toronto and Vancouver, these areas were seeing high (and rising) prices long before the pandemic. Now they’re soaring.

Mississauga

Coming in at number five is Mississauga. This city of over 700,000 residents is the third-largest in Ontario and sits on the banks of Lake Ontario.

Located right outside Toronto, this bustling, multicultural city saw the average home increase in price by $31,172 from November to December. As Toronto’s most populous satellite city, it isn’t too surprising that the area is in the top five.

Chilliwack

Up next in the number four spot is Chilliwack. This city of about 93,000 residents is 102 kilometres from Vancouver.

Located in Fraser Valley, Chilliwack was once primarily an agricultural area. Now suburban, it offers a lot of gorgeous scenery and outdoor recreation. The average home in Chilliwack cost $31,560 more in December than it did in November.

Fraser Valley

The Fraser Valley itself rolls in at number three. This beautiful area stretches from near Vancouver all the way down into Northern Washington in the U.S. The eastern edge of Fraser Valley is about 120 kilometres from Vancouver.

Fraser Valley is different than the other places on the list because it refers to an area rather than a city. Most people consider Fraser Valley to be outside the urban development of Vancouver.

The Fraser Valley area saw an average increase in the cost of a home rise $39,342 from November to December

Oakville

In the number two spot is Oakville, an Ontario town located in the Greater Toronto Area, about 35 kilometres from downtown Toronto. Sitting between Toronto and Hamilton, Oakville is Mississauga’s Lake Ontario neighbor to the south.

Smaller than Mississauga, with just under 200,000 residents, Oakville saw the average home increase in price by $43,520 from November to December 2021.

Toronto

If you had to predict which city would come in at the top of this list, Toronto was an easy choice. The Toronto market has been booming for a long time and hit the stratosphere in the past two years.

As the number one city in price growth month-to-month from November to December, Toronto saw the average home increase in price by $44,619. And that was just a single month during the past two years.

Looking at these dollar amount increases in just one month shines a spotlight on how inaccessible some areas have become to the average homebuyer.

2021 Increases

Even more eye-opening are price increases for the whole of 2021. Three housing markets in Canada saw home prices jump more than $250,000 last year.

The average home price in Toronto increased $262,200 in 2021. In Fraser Valley, that growth hit $270,537. People moving to Canada and looking for a home in Oakville could expect to pay $398,754 more at the end of 2021 than at the beginning.

These eye-popping numbers indicate that these areas are unlikely to see prices level off anytime soon.

Across the country, the number of homes changing hands in 2021 was 30% higher than the ten-year annual average. This enormous demand coupled with dwindling supply created a perfect storm for sellers and a very frustrating climate for buyers.

Economist Concerns For Canadian Markets With the Largest Home Price Increases

Some economists are sounding the alarm over the current state of the housing market in Canada. BMO economists are concerned that the country’s traditional growth factors of income, demographics, and interest rates are no longer driving the surge in prices and sales.

They noted that high demand, low supply, and low interest rates are fueling rising prices. They also expressed concern about repeat homebuyers and investors using variable-rate rather than traditional fixed-rate mortgages.

They fear that the housing market is uncoupling from its traditional underpinnings. This leaves average home buyers with few options in some of Canada’s most populous areas.

Exploring Other Markets

So what can homebuyers do in a market that seems intent on sending them to the sidelines? You don’t have to give up your dream of owning a home or living in Canada. The first step in navigating this extraordinary market is finding a realtor you trust.

Your real estate agent knows the market and the area they serve. One of the options we’ve talked about before is looking for a home in a smaller market where price growth has been less dramatic.

Ask your realtor about smaller markets within commuting distance of larger cities. Or consider a small, rural market if you work from home.

If you’re a first-time homebuyer the market may seem impossible right now, but it isn’t. If you’re living in Ottawa or moving to Ottawa we’ll help you find a home that fits your needs and your budget.