Canadian home-price increases aren’t even matching inflation, having slumped to a decade-low growth rate in July.

That’s according to the Teranet–National Bank House Price Index, which measures how 11 key metro-area housing markets from coast to coast are faring each month.

The overall 11-market index edged up by 0.4 percent on a year-over-year basis last month, while the rate of inflation clocked in at about 2 percent (around the range central bank policymakers target), according to Statistics Canada.

“However, the weakness is not regionally broad-based,” National Bank Senior Economist Marc Pinsonneault points out.

For instance, the Vancouver index was down 6.2 percent in July compared to the same time a year ago, the biggest annual drop of any major metro area. Vancouver was the only market where prices were down from the previous month, with the index declining another 1 percent.

Meantime, indexes for Calgary and Edmonton took hits of 3.1 percent and 2.8 percent, respectively, though they were up from June. On a month-over-month basis, Calgary prices climbed 0.7 percent, while Edmonton trailed at 0.5 percent.

Pinsonneault notes that Western markets — despite a slight 0.6-percent annual increase in Victoria — are weighing on the national index, which would have registered declines if adjusted for seasonal factors.

“That being said, the recent rebound in home sales across Canada was also felt in the Western part of the country,” Pinsonneault says. “This should help limit home-price deflation in this region.”

With Toronto home sales soaring as of late, including by nearly 25 percent in July compared to last year, home prices have been heating up.

The Teranet–National Bank index increased by 3.2 percent annually and 1.3 percent on a month-over-month basis in Canada’s most active housing market this July.

Yet Ottawa–Gatineau claimed the most pronounced price gains, with the index up 6 percent from a year ago, edging out Montreal, where the index rose by 5.8 percent. Ottawa’s index increased by 2 percent from June to July, and Montreal’s followed at 1.7 percent, although Winnipeg trumped both surging 2.9 percent.

Winnipeg prices remained relatively flat compared to last year, with the index just 0.5 percent higher than it was in July 2018.

“[A]nnual index growth has been decent in most of the six regions located in the central and eastern part of the country,” Pinsonneault explains.

Canadian Home-Price Gains Clock in at A Decade Low by Josh Sherman | Livabl