The average price of a Canadian home sold this past January increased by 16.9% to $470,290 compared to the same month 1 year ago. Home sales were higher during the month, but prices truly soared. As has been the case for several years, however, two large and hot markets, in Vancouver & Toronto, skewed the national average higher.
Take in Vancouver & Toronto out of the analysis and the average Canadian home was worth $338,390 last month. In this pooling, the year-over-year average home sale gain drops to 8%.
If B.C. and Ontario were omitted, the picture would look much bleaker – the average price of a Canadian home would have dropped by 0.3% in January to $286,911 Over the past year, the average prices has actually declined in January in 4 provinces: Alberta, Saskatchewan, Nova Scotia, Newfoundland and Labrador. The average price gain across Canada’s 26 largest cities was 4.7%; the strongest was 31% in Vancouver; the weakest was negative 10%, in Newfoundland and Labrador (which is considered one single market and thus compared together to other cities.)
BC’s liberal government is moving to make some buying space in the incredibly tight housing market with a series of tax changes in its budget stated at addressing resident and consumer affordability and supply. Mike de Jong, Finance Minister, said rising home prices and limited supplies are major areas of focus in the budget he introduced mid-February 2016.
He says buyers & builders of new homes valued up to $750,000 are being courted with a property transfer tax exemption, while those who can afford properties above $2 million will now pay a higher tax rate..
De Jong pointed out the exemption of the property transfer tax on new homes or condos below $750k will result in savings of $13,000 for buyers. The government estimates it can make about $75 million annually by adding an additional 3% transfer tax on the amount above $2 million. He says the budget also exempts children from medical services premiums starting next January, a monthly savings of up to $72 per month for a single-parent family with children.
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