The Great Canadian real estate price slowdown has been greatly exaggerated by a modeling skew. CREA data shows the composite benchmark price fell in June, furthering a double-digit correction for national home prices. The substantial correction is almost entirely due to prices falling in two of the country’s most expensive markets. The majority of Canada’s provinces are seeing prices rise, and hit new record highs.
Canadian Real Estate Prices Have Corrected Substantially… Sort Of
National home prices have made a substantial correction, with the composite benchmark falling 0.2% (-$1,600) to $688,600 in June. Last month’s decline helped to push prices 17.8% (-$148,800) lower than the record high, though they remain 26.7% (+$145,000) higher than 2019. That’s still substantial growth retained, and the correction was almost entirely contained to a few provinces.
Canadian Real Estate Prices Hit New Record Highs In Most Provinces, Brought Down Entirely By BC and Ontario
Canadian real estate prices: Seasonally adjusted CREA composite benchmark for each province in Canadian dollars.
Source: CREA; Better Dwelling.
Ontario real estate prices saw the biggest boom and bust in the country. Since hitting a record high in 2022, the price of a typical home across the province has dropped 24% (-$250,700) to $794,100 in June. Ontario is the only province to see a bigger drop than the national benchmark, meaning it provided most of the downward pressure on the index.
Ontario isn’t the only province to see a correction, but it was pretty close. BC saw the second-largest drop, but at less than half the rate of Ontario’s, it’s in a different league. From its peak, a typical BC home has fallen 10.2% (-$107,200) to $945,800 in June.
The other two provinces still below their peaks have seen such minor declines, they may as well be rounding errors. There’s New Brunswick at $324,400 in June, down 2.5% (-$8,200) from its record high. It was followed by Alberta at $513,300, down just 1.2% (-$6,400) from its peak. That’s it for declines.
Most Provinces Have Seen Real Estate Prices Hit New Record Highs
Most provinces across Canada saw home prices hit a new record high last month. The biggest monthly growth was in PEI, where prices climbed 1.6% (+$5,800) to $377,000 in June. It was followed by Newfoundland (+1.4%; +$4,300 m/m), Nova Scotia (+0.4%; +$1,700), Saskatchewan (+0.3%; +$1,200), and Quebec (+0.1%; +$300). Growth was modest in 3 of these 5 provinces, none resemble the sharp correction seen in Ontario or BC.
CREA doesn’t produce an HPI for Manitoba, though it does for Winnipeg. The only major market in the province just printed a record high in June, so it’s probably fair to say the province would have a minor correction at its worst.
Home prices are hitting record highs in most provinces, but the gap is narrowing. Canada’s priciest provinces are seeing home prices fall, while cheaper provinces are climbing—a pattern that may suggest bubble contagion. As buyers are priced out of their region, they chase affordability elsewhere, ignoring fundamentals in favor of relative bargains. “It’s up 40%, but still cheaper than Toronto.” The problem? When the anchor market corrects, so do the ones tethered to it.
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