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Canadian Housing Price Charts by Brian Ripley www.chpc.biz

 
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Go to: http://twitter.com/Brian_Ripley If you want to be notified when I update this site, go to: twitter.com/Brian_Ripley and click "Follow". Welcome to Brian Ripley's Canadian Housing Price Charts Blog for Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montreal comparing Canadian Real Estate House Prices and Market Values against a Backdrop of Gold Bullion, Oil, CPI, Interest Rates, the Canadian Yield Curve and the S&P TSX Housing, Financial Services, Energy and Gold indices. Also available are the current Canadian census population data, Stats Can employment earnings, mortgage affordability tables and a quick and easy spreadsheet for discovering real estate value. I update the commentary, the monthly price change summary, the housing and financial charts, the percentage price change scorecard and the Plunge-O-Meter, usually by the 2nd week of the month which is when the Canadian real estate boards generally have their data published from the previous month. If you want to advertise on this site, contact Brian Ripley

 
 

Home | 6 City Summary | 8 Charts | % Change Scorecard | Mortgage Affordability | Rate of Return Evaluator | History | Data Sources | Links & Directories | Plunge-O-Meter

 
REAL ESTATE EVALUATOR ~ CASH FLOW ANALYSIS ~ MORTGAGE TIPS ~ INCOME REQUIREMENTS ~ 6 CITIES PRICE CHART ~ 34 CITY AFFORDABILITY ~ POPULATION STATS

 

8 Charts on Canadian Housing Prices & Financial Indicators June 2010

6 Major Cities ~ Vancouver Housing Prices ~ Year Over Year Price Changes ~ Real Estate vs TSX Indices
 Gold/Real Estate & CRB/Real Estate Ratios ~ Housing Valued in Gold ~ Canadian Yield Curve ~ Interest Rate Spreads

REAL ESTATE PRICE SUMMARY FOR 6 CANADIAN CITIES ~ MORTGAGE AFFORDABILITY & EARNINGS TABLES

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      Canadian House Prices   Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montréal Prices  
      Click to ENLARGE, Back Button to Return   This chart shows the detached housing prices for Vancouver, Calgary, Edmonton, Toronto, Ottawa and Montréal. In June 2010 all cities covered saw their prices retreat except for Montreal which set a new all time record high under the weight of plunging sales (scorecard). Despite falling prices nationally, affordability is an issue as earnings slump (Earnings Chart). In Montreal you now need need 1.3 average wage earners to qualify for an average house purchase. In Toronto you need 2, in Calgary you need 1.9, and in Vancouver you need 3.8 average wage earners to make the payments. See the Affordability Table to see that fundamentals have been traded for wishful thinking. Thanks to patrick.net they offer: "The only true sign of a bottom is a price low enough so that you could rent out the house and make a profit. The basic buying safety rule is to divide annual rent by the purchase price: If annual rent / purchase price = 3% then do not buy. If it is 6% then consider purchasing and if the ratio is 9%, then buy."  
    Vancouver Real Estate Prices  

Vancouver detached, attached and apartment prices

 
    Click to ENLARGE, Back Button to Return   This chart shows Vancouver detached, attached (townhouse) and apartment (condo) prices. In June 2010, the average detached house price slumped another 2% M/M It took 7 years to run the prices up from the flat price channel of 2001 to the first peak in April 2008. Then an 8 month 16% decline and a loss of $123,000 in equity led to a relief rally beginning in January 2009 which zoomed for 16 months but then blew out in April 2010 and currently sits below the peak by 3%. Vancouver is the most unaffordable place to buy real estate out of 272 international cites according to demographia.com as the average earnings in BC remain 3.3% below Canada's average and 17.4% below Alberta (Earnings Chart).  
    Year/Year Rate of Change  

Price rate of change Vancouver, Calgary, Toronto and TSX Real Estate Index

 
    Click to ENLARGE, Back Button to Return   This chart shows the year over year rate of change in the price of Vancouver, Calgary, and Toronto detached housing as well as the S&P TSX Real Estate Index. In June 2010 the trend continued to the downside. The cash and margin buyers of the TSX Real Estate Index pushed momentum up into the Gonzo Bumpkin level of 67% Y/Y in March and the quick retreat from that Fibonacci look-a-like resistance has chilled the national market. The extreme TSX reading and subsequent reversal is the prelude to sentiment and price reversal for physical assets.  
    Real Estate vs. TSX Indices  

TSX Real Estate, Gold, Energy, Financial Services Indices and the CRB

 
    Click to ENLARGE, Back Button to Return   This chart shows the S&P TSX Real Estate, Gold, Energy and Financial Services Indices as well as the Bank of Canada Commodities Index (CRB) all valued in CA$. In June 2010 the Real Estate, Financials and Energy indices continued to slump while Gold continued zooming. The CRB broke out in December 2009 as the US$ rally got traction and took the CA$ unit with it. The focus on commodity dollars caused a rush in excitement but ultimately provided an opportunity for sellers to shed debt. Since the crash lows of 2009, Gold has recovered 112% of its last high, the Financials have recovered 33% and Energy and Real Estate have recovered 32% and 39%. Real Estate is a "slow" asset. Check your asset value with this evaluator before you are forced to.  
      Ratio of Gold/RE & CRB/RE   Ratios of Gold over TSX Real Estate and CRB over TSX Real Estate  
      Click to ENLARGE, Back Button to Return  

This chart shows the ratio of CA$ Gold Bullion over the TSX Real Estate Index (Gold/RE) as well as the ratio of the CA$ CRB (Commodities) Index over the TSX Real Estate Index (CRB/RE). Housing is a bundled commodity (lumber, steel, copper, materials) and the CRB/RE and the Gold/RE ratios had been moving parallel to each other up until the fall of 2008 when the Gold/RE ratio began to diverge with the massive sell off of real estate and the spike in gold and by February 2009 the ratio peaked at a reading of 12.2. From the summer of 2007 Gold (money) traded inversely to real estate up until September 2009 when both gold and real estate headed into new highs and began trading in the same direction. In June 2010, it looks like Gold and Real Estate are back into divergence.

 
    Housing Valued in Gold   Vancouver, Calgary and Toronto detached housing priced in Gold  
    Click to ENLARGE, Back Button to Return  

This chart shows Vancouver, Calgary and Toronto detached housing priced in ounces of gold valued in CA$. Gold bullion loses demand when commodities and financial assets boom but rises in value as those assets sell off. Gold mining share prices rise as the "real price" of gold rises (eg: the Gold/Commodities ratio http://stockcharts.com/h-sc/ui?s=%24gold%3A%24CRB) because the commodity cost (fuel, materials, equipment) is falling against the nominal price. Bullion attracts investment when credit markets contract because of its classic use as a hedge against currency depreciation and its ability to act as money. The millionaire metric allows you to see what your dollar is worth and the (declining) amount of gold you need to be a millionaire. In June 2010 gold continued up on its long term trend and despite the weakening CA$, the Millionaire metric maintained trend. It requires 59% less gold to be a millionaire than it did 5 years ago.

 
    Yield Curve   1mo, 2yr, 10yr and 30yr BoC treasury yields and 5 yr fixed mortgage rate  
    Click to ENLARGE, Back Button to Return  

This chart shows the 10 Year Less the 2 Year Canadian Bond Yield Curve (dotted yellow line) as well as the 1 month, 2 year, 10 year and 30 year Bank of Canada treasury yields and the retail 5 Year Fixed Mortgage Rate. In the spring and summer of 2004 the 10's less 2's renewed its trend to narrowing as the demand for speculative short term money ballooned and the curve set off on a path towards inversion igniting along the way a 3-4 year buying spree of over-leveraged assets, (commodities, real estate, junk bonds). In the spring of 2008, the curve shot up as short administered rates plummeted against firming long rates and the party kept on going. In June 2010 the market's sharp drop in the 10yr of 27 bps outmatched the BoC raising their rate 25 bps and so lenders shaved 10 bps off their 5 year mortgage rates to see if they can get some action. But credit growth is stalling. The inevitable return of risk management and rate increases at the long end is a future of progressively greater compounding expense for debtors.

 
    Interest Rate Spreads   Spread between Bank of Canada rate and 5 year fixed mortgage rate  
   

Click to ENLARGE, Back Button to Return

 

This chart shows that in June 2010 the spread between the Bank of Canada rate and the residential 5 year fixed mortgage rate narrowed another 35 bps (61 bps since April 2010) as the BoC raised its rate a quarter point and the commercial banks dropped their posted 5 year fixed mortgage rate 10 bps to 5.89%. Despite the narrowing of spreads, demand for credit is falling as the last buyers for overpriced Canadian real estate have come and gone. For more evidence on the effects of high debt levels in Canada, see the selected news items, and for a quick and easy way out of government's stupid tax policies at every level, see this note worthy solution.

 
             

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Home | 6 City Summary | 8 Charts | % Change Scorecard | Mortgage Affordability | Rate of Return Evaluator | History | Data Sources | Links & Directories | Plunge-O-Meter
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NOTE New Website Address www.chpc.biz REPLACES www.canadian-housing-price-charts.235.ca
A Blog for Vancouver Calgary Edmonton Toronto Ottawa Montreal Real Estate Housing Price Charts Gold Oil CPI S&P TSX
Data herein and opinions expressed by Brian Ripley are only that, and are not to be relied on as investment advice.
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