Zoocasa - Amidst economic fluctuations, varying interest rates, the unprecedented impact of a global pandemic, construction surges and shortages, and increased immigration, the Canadian real estate market has experienced a whirlwind of changes in the past decade. However, regardless of the state of the housing market, home prices have been persistently rising. From 2013 to 2023, the benchmark price of a single-family home in most of Canada has doubled. At the same time, mortgage rates have climbed to a 15-year high.
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So exactly how much has housing affordability changed in the past decade? To find out, Zoocasa analyzed single-family home prices in 19 Canadian cities from 2013 to 2023. Benchmark prices were sourced from the Canadian Real Estate Association in December of each year analyzed.
Single-Family Home Prices More than Doubled in Southern Ontario
Though single-family home prices are the highest in Toronto and Vancouver, neither claim the top spot for price growth in terms of percentages. London & St. Thomas took the crown, with the benchmark single-family home price rising by 178% from $221,800 in 2013 to $616,700 in 2023. That translates to a $394,900 increase in 10 years. Some of this price growth was likely driven by priced-out GTA buyers moving into comparably more affordable markets, including London & St. Thomas, Niagara Region, Kitchener-Waterloo, and Guelph & District, which all experienced rapid price growth in the past decade.
The price of a single-family home in Niagara Region shot up by 174% from 2013 to 2023, while in Kitchener-Waterloo the price of a single-family home increased by 159%. That comes out to a $399,900 increase in price in Niagara Region and a $490,200 increase in price in Kitchener-Waterloo.
However, outside of Greater Toronto, Guelph & District single-family homes experienced the largest price increase in Ontario over the past ten years, rising by $516,700. In Greater Toronto, the benchmark price of a single-family home increased by $685,500 from 2013 to 2023. During the early pandemic, low interest rates catalyzed a surge in the real estate market, pushing GTA single-family home prices above $1,000,000 for the first time, with the current benchmark sitting at $1,273,300.
Home Prices the Most Stable in the Prairies
All of this price growth is good for current homeowners who want to build equity, however, for those looking to enter the market for the first time, cities with moderate price growth could present a more attractive option. Single-family homes in Regina experienced the most stability over ten years, with the benchmark price increasing by just $18,800. St. John’s and Edmonton followed with a ten-year price increase of $48,000 and $49,900 respectively. The only other city to experience less than a 20% price increase was Saskatoon at 19.2%.
Despite having the most expensive single-family benchmark price of $1,964,400, Greater Vancouver single-family homes experienced an 84.5% increase in price over ten years. That is just shy of the national benchmark, which experienced an 86.8% increase in price from $417,100 in 2013 to $779,100 in 2023. Other cities that experienced a 10-year change in price less than the national benchmark’s change include Quebec CMA, Calgary, and Winnipeg.
Here’s How Much Mortgage Payments Have Increased
Higher home prices lead to heftier monthly mortgage payments, meaning most homeowners have higher monthly bills in 2023 than in 2013. On top of that, 5-year mortgage rates, despite falling to a low of 1.39% in 2020, have mostly climbed over the past decade, adding more strain to homeowners.
Take, for example, a London homeowner who bought a home in December 2013 at the December 2013 single-family benchmark of $221,800. According to Ratehub.ca’s mortgage payment calculator, if that homeowner put 10% down with a 5-year fixed rate of 3.24% amortized over 25 years, they would have had a monthly mortgage payment of $999. Fast forward to December 2023: a London homeowner who bought a single-family home at the 2023 benchmark price of $616,700, putting 10% down with a 5-year fixed rate of 5.24% amortized over 25 years, would have a monthly mortgage payment of $3,407. That’s a difference of $2,408.
Other southern Ontario cities have faced similar increases. Based on the single-family benchmark price for each year and assuming a homeowner put 10% down with the 5-year fixed rate of 3.24% in 2013 and 5.24% in 2023, Niagara Region mortgage payments have increased from $1,036 in 2013 to $3,479 in 2023. Using the same parameters, the monthly mortgage payment for a benchmark single-family home in Kitchener-Waterloo has risen from $1,387 in 2013 to $4,409 in 2023.