**Introduction:**
Over the past five years, the Canadian real estate market has experienced a remarkable upswing in home prices, resulting in substantial equity gains for homeowners who entered the market in 2018. A recent study by Zoocasa analyzed property values in 15 major housing markets across Canada, unveiling impressive equity growth. In this blog post, we’ll delve into the findings of this study, highlighting the noteworthy property value increases in different regions and the financial advantages enjoyed by homeowners.
**Notable Equity Growth Across Canada:**
The Zoocasa study compared Canadian Real Estate Association benchmark prices from July 2018 to July of the current year, showcasing remarkable increases in property values.
**Ontario Leads the Way:**
Among all provinces, Ontario stands out with the most significant property value growth. Notably, homeowners in the Greater Toronto Area (GTA) have witnessed remarkable gains. In July 2018, the average benchmark price for a house in the GTA was $759,000. Fast forward to 2023, and that figure has surged to an impressive $1,161,200. This extraordinary increase translates to a substantial $401,700 in additional equity for homeowners in the GTA.
**Gains Beyond Major Cities:**
The trend of rising property values extends beyond major metropolitan areas, partly driven by the search for more spacious and affordable homes, especially during pandemic lockdowns. Let’s explore some of the notable regions:
– **Hamilton-Burlington:** Property values in this region have surged by a remarkable $314,400 since July 2018, with the benchmark price reaching $873,600 in 2023, compared to $559,200 in 2018.
– **Kitchener-Waterloo:** Homeowners in this area have witnessed substantial equity growth, with the average house’s equity increasing by $309,200 since 2018.
– **London and St. Thomas:** Property values in London and St. Thomas have seen a notable increase of $272,000 since 2018, reflecting the broader trend of rising property values in Ontario.
– **Ottawa:** Homeowners in Ottawa have seen their equity climb by an impressive $248,100, solidifying homeownership in the nation’s capital as a wise long-term investment.
**British Columbia’s Property Value Gains:**
Homeowners in Victoria and the Greater Vancouver Area in British Columbia have also experienced significant benefits from rising home prices. In Victoria, home prices have risen by $248,400 since July 2018, reaching an average price of $887,900 in 2023. Meanwhile, Vancouver, known for its high real estate prices, has witnessed a $197,600 gain, with prices soaring to $1,210,700 in July this year from $1,013,100 in 2018.
**Property Value Growth in Other Regions:**
Property values in Montreal, Calgary, Saint John (New Brunswick), Victoria, the Greater Vancouver Area, and more have shown impressive gains over the last five years, contributing to additional equity ranging from $100,000 to $248,400.
Not all markets experienced triple-digit gains in home values, either. The benchmark price in Quebec City came in just shy of the $100,000 mark, rising $90,400 since 2018. Winnipeg and Saskatoon also experienced modest increases, with values up $70,700 and $65,300, respectively. The return on investment was less great for homeowners in Regina, who ended up with an additional $26,200 in equity after five years, and even worse for those in Edmonton, who saw values increase by only $19,800.
Breaking down property value changes by housing type reveals even more interesting findings. For instance, 2018 buyers of townhouses in Kitchener-Waterloo can boast that they’ve built more equity over the past five years than their counterparts in any other part of the country, including expensive Toronto and Vancouver. Townhome prices in the Kitchener region have almost doubled in the past five years, climbing $307,000 from the July benchmark price of $338,000.
The Toronto Regional Real Estate Board said on Sept. 6 said there were 5,294 sales in August, up almost one percent from July. But on a year-over-year basis, sales were down 5.2 percent.
The average home price of $1,082,496 was three percent lower in July, but up 0.3 percent from August 2022.
Higher borrowing costs arising from high-interest rates, combined with uncertainty over whether rates will keep going up, are adding volatility to the housing market, TRREB said.
**Factors Impacting Equity:**
It’s crucial to note that the exact amount of equity gained varies based on factors such as mortgage payments, home equity lines of credit, and other loans, making individual experiences unique.
**Conclusion:**
The remarkable surge in Canadian home prices over the past five years has resulted in substantial financial benefits for homeowners who made their purchases in 2018. Ontario, with a focus on the Greater Toronto Area, leads the way with significant equity gains. However, this trend extends beyond major cities, with smaller regions also experiencing remarkable property value increases. As the real estate market continues to evolve, these equity gains underscore the appeal of homeownership as a wise long-term investment in Canada’s dynamic housing landscape.