OTTAWA Jan 12 Canadian home prices continued to
rise in the final months of 2016 as hot markets in Ontario
offset the moderating effects of a foreign buyers tax in
Vancouver, though most markets were past their peak, separate
reports showed on Thursday.
Prices of existing homes, the biggest slice of the real
estate market, rose 0.3 percent in December as Toronto, the
biggest market, and Victoria, saw hefty price gains while
Vancouver prices fell again, the Teranet-National Bank Composite
House Price Index showed.
The index, which measures price changes for repeat sales of
single-family homes, showed national home prices surged 12.3
percent from a year earlier, the largest 12-month increase since
A separate report from Statistics Canada showed prices for
new homes - a smaller portion of the market than home resales -
inched up 0.2 percent in November from October amid price
increases across much of Ontario.
Analysts polled by Reuters had predicted a 0.3 percent
advance. Overall, prices climbed in 10 of the survey's 21
markets, fell in four and were unchanged in seven.
The Teranet report showed Vancouver prices dropped 0.8
percent in the month, the third straight monthly decline after
21 months of gains, shaving a cumulative 2.8 percent from prices
in three months.
The once-hot Vancouver market has cooled since the
government imposed a foreign buyers tax in August 2016 in
response to public perception that wealthy foreigners, mostly
from mainland China, were pricing locals out of the market.
Analysts have speculated that the tax, imposed only in
Vancouver, could drive foreign investment to other cities,
including nearby Victoria, or Toronto, Canada's hottest market.
Prices in both those cities climbed 1.2 percent in December.
The government moved again in recent months to tighten
mortgage lending rules to cool the market and prevent borrowers
from taking on too much debt, the latest of steps taken over the
last five years amid concerns about a potential housing bubble.
The Teranet report showed national prices jumped 12.3
percent from December 2015, with the annual gain led by a 19.7
percent increase in Toronto, 17.7 percent in Victoria, 17.5
percent in Hamilton, and 17.0 percent in Vancouver.
Toronto, nearby Hamilton, and Victoria all notched record
high prices, but most of the other Canadian markets were well
past their peak.
(Additional reporting by David Ljunggren; Editing by Bernadette