The CMHC said that this slowdown can be attributed to softer growth in the two most active real estate markets in the country – namely, Toronto and Vancouver. Average sales prices in these areas are estimated to be at $612,000 and $887,600, respectively.
Meanwhile, outliers such as Montreal enjoy average sales prices of $338,500 (almost $100,000 lower than the national average of $433,600), making these locations the best choices for bargain home purchases.
According to McGill University finance professor Mo Chaudhury, weaker economic fundamentals such as a less vibrant business sector are responsible for causing lower demand in Montreal and other cities. Other factors such as political instability, sovereignty concerns, reduced immigration numbers, and weaker incomes continue to limit demand in locales such as Quebec.
The Canada Mortgage and Housing Corporation (CMHC) said on Tuesday that price growth in real estate across the country is expected to stabilize at 1.3 per cent in 2016, down from 7.2. per cent this year. Other forecasts place growth at 1.4 per cent in 2017.