| TORONTO, June 12
TORONTO, June 12 After five years of unsteady
gains, the Canadian housing market appears to be cooling with
regional disparities looming large, two reports showed on
The Teranet-National Bank Composite House Price Index, which
measures price changes for repeat sales of single-family homes,
showed national home prices rose 0.8 percent in May, but it also
showed the pace of price appreciation decelerating slightly on a
A separate report from Statistics Canada showed new housing
prices edged up 0.2 percent in April from March, as expected,
matching previous monthly rises and chugging along at an annual
1.6 percent rate of increase.
The Teranet report measures home resales, a bigger portion
of the market than the new-home sales measured by the Statistics
Canada report, which is also more dated because its data is from
But both add to signs that the housing market is slowing
after five years of uneven growth. Resale prices have increased
by about 32 percent since the market dipped in 2009 due to the
financial crisis and recession.
"Canada's housing boom hasn't gone bust - it's just fizzled
out," Bill Adams, senior international economist at PNC
Financial Services, said in statement.
"The drag on the economy from a cooler real estate sector
will continue to be a manageable one as long as housing prices
are inching higher or even holding steady," he added. "Longer
term, the jury is still out on what will happen to Canada's
highly leveraged household finances when mortgage interest rates
someday reset to higher levels."
Authorities had been concerned that a housing bubble was
forming, but of late have been predicting a soft landing for the
TERANET SHOWS REGIONAL DISPARITIES
While the Teranet report showed a healthy 0.8 percent gain
in prices in May, it is a modest reading for what is
traditionally one of the strongest sales months of the year.
May's increase was the fifth smallest for May in the 16 years
covered by the index, Teranet said.
Prices were up from the previous month in seven of the 11
markets surveyed, led by a 3.1 percent gain in Halifax, a 2.0
percent rise in Hamilton and a 1.6 percent rise in Quebec City.
Prices were flat in May, compared with April, in Ottawa and
Vancouver, and declined 0.1 percent in Victoria and 0.3 percent
Prices were up 4.6 percent from a year earlier, a slowdown
from April's 4.9 percent price gain. And there were big regional
disparities, with four cities seeing prices fall from May 2013.
The year-over-year price gains were led by an 8.7 percent
rise in Calgary, an 8.2 percent gain in Vancouver, a 6.0 percent
rise in Toronto. Prices were down 0.4 percent in Halifax, 1.2
percent in Montreal, 1.4 percent in Ottawa and 1.6 percent in
(Additional reporting by Randall Palmer in Ottawa Editing by
Frank McGurty; and Peter Galloway)