He who panicked first, panicked best? Some of the charts are just kind of funny.
By Wolf Richter for WOLF STREET.
Home prices in Canada dropped 1.2% in December from November, the ninth month-to-month declined in a row, and are now down 17.4% from the peak in March 2022, and down by 7.5% from a year ago, according to the Canada MLS Home Price Index by the Canadian Real Estate Association (CREA). Sales plunged by 39% year-over-year.
In the two years from the beginning of the Bank of Canada’s money-printing binge in March 2020 to the beginning of the rate-hike cycle in March 2022, the composite benchmark price had spiked by 54%. This spectacular housing bubble, on top of an existing housing bubble, was entirely fabricated by central bank money-printing and interest rate repression. This was a global phenomenon, triggering massive global inflation. So now comes the invoice for the drunken money-printing party.
The composite benchmark price of the Canada MLS Home Price Index for all types of homes has now dropped from C$151,300 in the nine months, to C$717,000.
That 17.4% drop in the benchmark price from the peak in March was by far the largest and fastest nine-month drop in CREA’s data going back to 2005. In Canada, there wasn’t much of a housing bust during the Financial Crisis, but now the housing bust is here, and it’s real, and it’s not seasonal or whatever. Homes are being repriced on a large scale:
Greater Toronto Area: The MLS Home Price Index composite benchmark price dropped 0.8% for the month to C$1.08 million:
- From peak in March 2022: -19.0%
- Year over year: -8.9%
- Drop in 9 months from peak in March 2022: -C$253,600
- Jump in 9 months to peak in March 2022: C$313,000
Greater Vancouver: The MLS Home Price Index composite benchmark price dropped 1.5% for the month to C$1.11 million:
- From peak in April 2022: -11.9%
- Year over year: -3.3%
- Drop in 8 months from peak in April 2022: -C$150,400
- Jump in 8 months to peak in April 2022: +C$163,300
Hamilton-Burlington metro: Prices made even more spectacular moves than those in Toronto during the pandemic: From the beginning of the Bank of Canada’s money-printing binge in March 2020 to the price peak in February 2022, the composite benchmark price spiked by 70%. Now they’re heading back down even faster and more spectacularly.
The MLS Home Price Index composite benchmark price plunged another 3.3% for the month to C$803,200, the lowest since February 2021:
- From peak in February 2022: -24.9%
- Year over year: -14.8%
- Drop in 10 months from peak in February 2022: -C$265,600 – going down faster than up.
- Jump in 10 months to peak in February 2022: +C$244,400
Charts like this are just kind of funny:
Victoria: The composite benchmark price dropped another 2.4% for the month to C$872,700:
- From peak in June 2022: -11.4%
- Year over year: +2.3%
- Drop in 6 months from peak in June 2022: -C$112,800
- Jump in 6 months to peak in June 2022: +C$132,200
Ottawa: The composite benchmark price dropped 2.0% for the month to C$610,800:
- From peak in March 2022: -16.1%
- Year over year: -4.6%
- Drop in 9 months from peak in March 2022: -C$117,400 – going down far faster than up
- Jump in 9 months to peak in March 2022: +C$85,500.
Calgary: Despite the oil boom, home prices are now falling in Canada’s oil capital. The composite benchmark price dropped 0.6% for the month, the seventh month in a row of declines, to C$506,400:
- From peak in May 2022: -4.8%
- Year over year: +8.1%
- Drop in 7 months from peak in May 2022: -C$25,800
- Jump in 7 months to peak in May 2022: +C$67,200:
Montréal: The composite benchmark price dropped 0.6% for the month to C$497,800:
- From peak in May 2022: -10.4%
- Year over year: -0.7%
- Drop in 7 months from peak in May 2022: -C$57,800
- Jump in 7 months to peak in May 2022: +C$64,600:
Halifax-Dartmouth: After years of housing sanity, the money-printing bug turned buyers’ brains to mush. From February 2020 to the peak in May 2022, the benchmark price spiked by 81%.
The composite benchmark price, after huge plunges in the prior months, ticked up a hair in December (+0.2%), to C$480,600:
- From peak in May: -12.3%
- Year over year: +6.3%
- Drop in 7 months since peak in May: -C$67,200
- Jump in 7 months to peak in May: +C$105,200:
Quebec City: The composite benchmark price dropped 0.6% for the month to C$468,100:
- From peak in May: -10.0%
- Year over year: -0.3%
- Drop in 7 months since peak in May: -C$52,200
- Jump in 7 months to peak in May: +C$59,400:
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