![\"canadian-single-family-homes-prices\"](\"https:\/\/www.livabl.com\/articles\/wp-content\/uploads\/2021\/03\/canadian-single-family-homes-prices.jpg\")
<\/a>Photo:\u00a0Tierra Mallorca<\/a>\/Unsplash<\/a><\/em><\/p>\nA \u201cmix of exuberance and haste\u201d has sent Canadian single-family home prices into the stratosphere and many parts of the country have seen \u201cself-reinforcing price dynamics\u201d take hold.<\/p>\n
That\u2019s the message from RBC Senior Economist Robert Hogue, who in commentary published earlier this month, wrote that in the past six months the benchmark price of a Canadian single-family home has risen by $100,000. That\u2019s a 15 percent increase in value in only half a year\u2019s time, which ranks as the sharpest increase to the national benchmark price of all time.<\/p>\n\n
In line with the well-documented shift in buyer interest to suburban markets, the country\u2019s most expensive cities for real estate \u2014 Vancouver and Toronto \u2014 didn\u2019t record the largest single-family home price gains in the period Hogue looked at.<\/p>\n
Homebuyers in Barrie, an hour north of Toronto, have seen single-family home prices jump by $147,000 since August. Meantime, in Fraser Valley, a region east of Vancouver that contains the small cities of Abbotsford and Chilliwack, recorded a $145,000 increase in the single-family home prices during the same period.<\/p>\n
Vancouver and Toronto were no slouches either, with Hogue noting prices had increased $143,000 and $139,000, respectively, over the last six months.<\/p>\n
\u201cClearly homebuyers continue to be a force to be reckoned with a year into the pandemic. Rock-bottom interest rates, changing housing needs and high household savings seem to have motivated many to make a move \u2014 or take the investment plunge,\u201d Hogue wrote.<\/p>\n
Speculation has also arrived on the heels of the steep increase in home prices, the economist said. Buyer \u201cFOMO\u201d \u2014 the idea a homebuyer may lose out on a property they can afford if they wait too long \u2014 is another dynamic at play in the red-hot market.<\/p>\n
While Hogue writes that an \u201coverheated market\u201d increases the risk of a future price correction, RBC\u2019s economics team continues to forecast persistent price appreciation for the remainder of the year with the pace of the gains gradually declining.<\/p>\n
\u201cA creeping-up of longer-term interest rates, deteriorating affordability, the resumption of office work and possible policy intervention will eventually cool homebuyer demand and set the stage for a soft landing,\u201d Hogue wrote.<\/p>\n