While the latest interest rate hikes might be helping to cool real estate activity in Canada, several smaller markets are seeing an annual increase in the average price per square foot of a home, particularly among single-family dwellings.
This is according to Century 21 Canada’s new price-per-square-foot survey, which looks at the average cost per square foot of properties sold between Jan. 1 and June 30, 2023, compared to the same period over previous years. The survey uses sales data related to detached houses, condominiums and other home types from Century 21 franchises across the country.
Smaller cities outside of major urban hubs, such as Windsor and Niagara Falls in Ontario, saw an increase in the average price per square foot of a detached house between 2022 and 2023. In Windsor, Ont., the price per square foot of a detached house rose from $306 in 2022 to $469 in 2023, while the average square-foot price for a similar home in Niagara Falls, Ont., grew from $531 in 2022 to $606 in 2023.
It’s possible that smaller cities surrounding regions such as the Greater Toronto and Vancouver areas have continued to see high sales activity despite recent interest rate hikes, said Robert Hogue, assistant chief economist at the Royal Bank of Canada.
“Those smaller markets benefit from an affordability advantage relative to the core of the GTA or the core of the Vancouver area,” he told CTVNews.ca in a telephone interview on Wednesday. “They're continuing to benefit from migration inflows from those large urban areas, which would continue to sustain demand.”
But following two interest rate hikes by the Bank of Canada in June and July, Hogue said it’s likely that prices in these regions, which include markets such as Niagara Falls, Ont., and the Fraser Valley in British Columbia, will flatline through the remainder of the year.
In fact, according to RBC’s latest housing market update, price gains reported over recent years are expected to moderate to some degree in the months ahead. With elevated interest rates helping to reduce demand by trimming household budgets, and residential housing supply on the rise, Canadians are likely to see a more balanced market going forward, the report states.
“On a national basis, we’re in a more balanced territory,” he said. “If the markets remain more balanced, as we expect over the coming months, that should… reduce upward pressure on prices.”
According to the MLS Home Price Index (HPI), the benchmark price for a home in Canada was $754,800 in July. The MLS HPI is a tool used to gauge home price levels based on the value homebuyers assign to different housing attributes, as opposed to using raw average prices. While this amount represents an increase of 1.1 per cent month-over-month, it indicates a slower rate of growth compared to the average of 1.9 per cent reported over the last three months.
“[Interest rate hikes are] already having a dampening effect on prices,” said Hogue. “It’s just curbing the rate of increase in prices.”
MONTREAL, VANCOUVER AMONG SOME OF THE MOST EXPENSIVE CITIES
While smaller cities in Ontario may have seen prices rise year-over-year based on the survey conducted by Century 21 Canada, the average cost per square foot of a condominium and detached house in Montreal fell on an annual basis. In downtown and southwest Montreal, the average price per square foot dropped nine per cent among detached houses and six per cent among condos between 2022 and 2023.
“We knew that the market had to come down from the highs of the last few years, and we’re now fully seeing the effects of the interest rate growth that started last year,” Todd Shyiak, executive vice-president of Century 21 Canada, said in a press release issued Aug. 2.
Despite this, the survey shows detached homes in Montreal are the most expensive in Canada per square foot, at $1,235.
In British Columbia, the prices per square foot of various property types have largely dropped across the province year-over-year, including in Vancouver. Despite this, the city is still home to some of the most expensive residential properties when looking at prices per square foot in Canada.
PRAIRIES SEE STABILITY, ATLANTIC PROVINCES SEE GAINS
Comparatively, Prairie provinces have seen stability in average prices per square foot on an annual basis, with minor gains and losses reported across the region. Additionally, cities such as Regina and Winnipeg have some of the least expensive prices per square foot in Canada, at $189 and $249 for condos, respectively.
Overall, average prices per square foot are on the rise in Atlantic Canada due to strong demand for lower home prices, according to the survey. Detached houses in Fredericton and Moncton, N.B., saw a rise in the average price per square foot year-over-year.
“We continue to see growth in smaller markets as more families seek a lower cost of living,” Shyiak said.
Alberta also saw prices increase in most markets and across a number of property types year-over-year. Sales activity as a whole remains high in Alberta, as demand for housing continues to be strong, Hogue said, particularly in cities such as Calgary.
Below is a list of cities with some of the most and least expensive home prices, based on the average cost per square foot, as well as properties that are currently on the market in these areas.
(Daniel Mackay, Groupe Mackay)
Price: $1,045,000
Home Type: Detached house
Property Size: 2,500 sq. ft.
Lot Size: 5,364 sq. ft.
This two-storey home in Montreal spans approximately 2,500 square feet and has four bedrooms and two bathrooms. In addition to the kitchen and living areas is a large dining room with ceramic tile flooring and various windows. The dining area also offers access to the fully fenced backyard, which includes a patio as well as an in-ground pool.
Average price per square foot (PPSF), according to survey: $1,235
(Rory Blanchard, Aperture / Samantha Whiffin and Tiffany Wilson, Angell Hasman & Associates Realty)
Price: $1,180,000
Home Type: Condominium
Property Size: 916 sq. ft.
Lot Size: N/A
Built in 2016, this condo unit situated in downtown Vancouver has a modern design featuring quartz countertops and updated bathroom fixtures. Along with two bedrooms and two bathrooms, this unit’s open-concept layout also features a combined living, dining and kitchen area, as well as in-suite laundry. Residents of the apartment building have access to an outdoor pool and hot tub.
Average PPSF, according to survey: $1,132
(West Blue Media / Wendy Giammarino, Century 21 Atria Realty)
Price: $999,000
Home Type: Condominium
Property Size: 1,100 sq. ft.
Lot Size: N/A
Located in a boutique condo building in downtown Toronto, this unit is a short walk from restaurants, neighbourhood parks, public transit and more. With nearly 1,100 square feet of living space, this condo has two bathrooms, two bedrooms and a den, which can be used as a third bedroom. Windows in these rooms and throughout the rest of the unit allow plenty of natural light into the home.
Average PPSF, according to survey: $1,013
(Visual Advantage / Becky Deutschmann, Re/Max Twin City Realty)
Price: $775,000
Home Type: Condominium
Property Size: 1,398 sq. ft.
Lot Size: N/A
This boutique condo in downtown Kitchener, Ont., has two storeys. On the main level, the floor-to-ceiling windows next to the living room lead to a private outdoor terrace. Meanwhile, the upper level consists of the main bedroom and a three-piece ensuite with granite counters and a tiled shower. Also on the top floor is a loft-style den.
Average PPSF, according to survey: $838
(Lorenzo Daminato, Rennie & Associates Realty)
Price: $1,550,000
Home Type: Detached house
Property Size: 1,791 sq. ft.
Lot Size: 4,026 sq. ft.
Situated in North Burnaby, B.C., this detached house has three bedrooms and two bathrooms. Recent updates to the home include the installation of granite countertops in the kitchen and new flooring throughout. The basement, which is fully finished, has a separate entrance, and the home itself is a short drive from grocery stores, restaurants and parks.
Average PPSF, according to survey: $725
(Noah James Media / Jonathan Lander, Re/Max Nova)
Price: $549,900
Home Type: Condominium
Property Size: 591 sq. ft.
Lot Size: N/A
With nearly 600 square feet of living space, this condo in downtown Halifax has one bathroom and one bedroom, along with a den. The unit also features a combined kitchen, living and dining area. Overlooking Gorsebrook Park, the apartment is located near public transit and building amenities include an outdoor pool and gym.
Average PPSF, according to survey: $467
(Niche Media Inc. / Allan Asplin, Judy Lindsay Team Realty)
Price: $524,900
Home Type: Detached house
Property Size: 1,411 sq. ft.
Lot Size: 4,198 sq. ft.
Although it was originally built in 1939, this character home in Winnipeg’s Norwood Flats neighbourhood has been renovated in recent years. It has an open-concept living, dining and kitchen area, as well as three bedrooms and three bathrooms. In the finished basement are recreation and laundry rooms, and the home’s backyard is fully fenced.
Average PPSF, according to survey: $291
(Wei Wong and Dale MacMillan / Natalie McCormick, Royal LePage ArTeam Realty)
Price: $375,000
Home Type: Condominium
Property Size: 1,115 sq. ft.
Lot Size: N/A
This two-bedroom, two-bathroom condo in downtown Edmonton spans more than 1,000 square feet. With 10-foot vaulted ceilings, the unit includes a loft space with access to two private rooftop patios. Facing south, the condo overlooks Warehouse Park, a green space currently under development in the city’s downtown core.
Average PPSF, according to survey: $204
(Angie Sebree / Mitzi Billard, Re/Max Real Estate Central Alberta)
Price: $174,900
Home Type: Condominium
Property Size: 843.43 sq. ft.
Lot Size: N/A
Located on the main floor of its building in Red Deer, Alta., this condo unit has an open-concept layout, with a combined dining and living area that has a corner gas fireplace and offers access to a private patio. Completing the unit are two bedrooms, one bathroom and a laundry room.
Average PPSF, according to survey: $196
(Dave Watt, The Right Choice Realty)
Price: $579,900
Home Type: Detached house
Property Size: 2,603 sq. ft.
Lot Size: 7,040 sq. ft.
Hardwood floors run throughout this detached, two-storey house in Fredericton. On the main floor, a double-sided natural gas fireplace divides the living room and kitchen area, which also has a centre island and a patio door offering access to the back deck. On the upper floor are all four bedrooms and two of three bathrooms.
Average PPSF, according to survey: $196
(Hatch Media / Sara McKinley, Century 21 Dome Realty)
Price: $324,900
Home Type: Condominium
Property Size: 1,336 sq. ft.
Lot Size: N/A
This warehouse condo in Regina mixes classic and contemporary design styles, with 12-foot ceilings and exposed brick walls throughout. The open-concept floorplan combines the living and dining rooms with the custom kitchen, which has a corner pantry and concrete countertops. Rounding out the unit are two bathrooms and two bedrooms, one of which offers access to a bank vault that has been converted into a walk-in closet.
Average PPSF, according to survey: $189
(Amanda Ryan / Andrew Duggan, Keller Williams Platinum Realty)
Price: $289,900
Home Type: Detached house
Property Size: 2,226 sq. ft.
Lot Size: under 4,050 sq. ft.
Inside this two-storey house in St. John’s, N.L., hardwood floors run throughout, while the original curved staircase from when the home was built in 1935 remains intact. On the main floor are the living and dining rooms as well as the kitchen, which features a breakfast bar and stainless steel appliances. Meanwhile, all three bedrooms sit on the upper floor. The home also has two bathrooms and a laundry room.
Average PPSF, according to survey: $167
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