Canadian Housing Markets Continue To Diverge

Submitted by IWB, on September 14th, 2016

 

by: otterwood

Canadian housing markets continue to diverge with large price gains in Toronto (+2.8%) and Vancouver (+1.7%) driving Canada’s hottest markets even higher throughout August. The new tax imposed on foreign buyers in BC may have had some effect in August as the monthly price increase in Vancouver was below 2% for the first time in seven months. In contrast market conditions in Toronto are the tightest in at least 14 years as the number of listed houses for sale represent just 1.1 months of sales. See the following charts from National Bank:

Right now the market hates Canadian housing which you can see in the short interest on Canadian banks. The chart below shows short positions are elevated. Long term trends like the one in Canadian housing don’t usually end when everyone’s expecting it.