Canadian home prices are dropping faster and faster, especially in Ontario and parts of British Columbia as big interest rate hikes increasingly take a toll on buyers. The national aggregate MLS Home Price Index recorded its largest-ever one-month decline (-1.9%) in June, following drops of 1.0% in April and 0.5% in May. The price correction is concentrated in Ontario where the MLS HPI fell in all markets last month\u2014significantly so in cottage country, London, Woodstock, Kitchener-Waterloo and other areas that saw tremendous appreciation during the pandemic. Property values are also trending down more rapidly in British Columbia\u2019s Interior and Lower Mainland regions with June marking the steeper drop in the MLS HPI of the past three months. <\/p>\n
Other parts of the country are now beginning to see softening prices. The MLS HPI fell in Winnipeg, Montreal and Quebec City from May to June, which we think will mark a turning point. Calgary and Halifax may not be far behind with the index largely flat last month. These developments fit our view that property values will come under increasing downward pressure across Canada over the coming months with pricier markets on the front line of that trend. <\/p>\n