Home News The Most Splendid Housing Bubbles in Canada, September Update: House Prices Plunge

The Most Splendid Housing Bubbles in Canada, September Update: House Prices Plunge

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Ridiculous price spikes now face Bank of Canada monster rate hikes, QT and mortgage rate spikes.

To wolf richter for wolf street.

In Hamilton, Ontario, August prices plummeted 5.8% from July, down 10.5% in three months, after a ridiculously staggering spike. In Toronto, prices plummeted 4.0% in his July-August period, down 8.3% in three months. In Vancouver, August prices fell 2.0% from his July. Ottawa increased 3.1% in August. 3.6% in Halifax; But in his two oil cities of Calgary and Edmonton, prices still jumped. I will explain each one in a moment.

Combined with the Lehman bankruptcy in December 2008, the 11-city Teranet-National Bank House Price Index fell 2.4% in August from July, its biggest ever drop. Over the past three months, the overall index has fallen 4.1% of his. That took March and he down from a 19% range in April to a year-on-year surge of 8.9%.

Canada’s greatest housing bubble often ranks at the top of all housing bubbles in the world. But consumer price inflation has spiked and spread to the heart of the economy, with the Bank of Canada cracking down with a series of rate hikes and the QT.

These rate hikes included 75 basis points at the September meeting. When it specifically wiped out the housing market recessionand by Monster 100 basis points at July meetingBoC President Tiff Macklem explained to Canadians: After three decades of low and steady inflation, many Canadians are experiencing the pain of high inflation and the uncertainty that comes with it for the first time. “

The BoC is also unloading its balance sheet. Quantitative tightening is the opposite of quantitative easing, or “printing money,” and has the opposite effect on asset prices.this is Total assets down 25% from peak:

Higher interest rates and QT fuel the greatest housing bubble.

HamiltonOntario blew out Vancouver and Toronto to become Canada’s biggest-ever housing bubble, with a ludicrous price increase of about 30% year-over-year.

But now you can hear the distinctive hissing of hot air coming from this most wonderful residential bubble. August prices fell 5.8% from July, according to the Teranet-National Bank House Price Index. Plunging 10.5% in the three months since its peak in May, year-on-year price gains have fallen to 8.7%.

Is the three-month plunge due to seasonality? Take a look at the chart and see if there is a seasonality to this plunge.

Greater Toronto Area, house prices plummeted 4.0% in July-August after a spectacularly ridiculous spike that peaked in May. In the three months since, the index has plunged his 8.3%, and year-on-year gains have him plummeting to 7.8%.

in Greater Vancouver, Home prices fell 2.0% over the month, down 4.1% from their peak in April. This capped his year-on-year increase at 8.4%.

The Teranet-National Bank House Price Index is based on the August closed sale. This data set is neither seasonally adjusted nor a 3-month moving average. The 3-month moving average used in our previous report reacts too slowly to see how the housing market slips from a ludicrous surge to a cliff edge.

The index’s methodology is based on “repeat sales,” which tracks the price of the same home each time it is sold. Unlike median pricing, the “repeat sale” method is not affected by changes in the mix of homes sold.

Halifax It’s not a huge city by any means, but it had a pretty good housing bubble with house prices skyrocketing in the 35% range year-over-year. And the show peaked in June, and in the two months since, prices have plummeted a combined 8.7%, including a 3.6% drop in July-August. This halved the year-on-year increase to 15%.

in Victoria, house prices fell 1.2% over the month, down 2.7% from their peak in May. This limited his year-on-year increase to just 15%.

in WinnipegHouse prices fell 1.4% from their peak in July to August, capping year-on-year gains of 9%.

in montreal, house prices fell slightly in August after falling 1.9% in July from a peak in June. That put him down 1.7% from his peak in June, and his year-on-year rise narrowed to 12.1%.

in Ottawa, home prices fell 3.1% in July-August and 4.6% two months after their peak in June. This reduced his year-on-year profit to 4.5%. Watch out for price spikes from March that will make him late to the party through May.

in Quebec City, house prices fell 1.1% from peak July to August. This reduced his year-on-year rise to 10.5%.

in Calgary, house prices were roughly flat from mid-2007 until mid-2020, when the Bank of Canada money printing frenzy began to reach the housing market. With Calgary being Canada’s oil capital and the oil business currently booming, money is still pouring into the housing market.

In August, the index rose 1.3% from July to a new record, up 13.6% year-on-year.

in Edmonton, The Canadian oil patch also saw home prices rise 2.7% in the month and up 4.6% year-on-year. Notice that the oil boom housing bubble that ended in 2007 has had virtually no price increases for 15 years. Not much of a housing bubble here.

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