House prices jump another 10% to $406,372

The average price of a Canadian home has risen to more than $400,000, according to new data released on Monday.

Number of homes sold stays flat even as prices jump significantly

The average Canadian home is now worth more than $400,000, CREA says. (Casper Hedberg/Bloomberg)

The average price of a Canadian home has risen to more than $400,000, according to new data released on Monday.

The Canadian Real Estate Association said Monday the average price of a resale home was $406,372 in February. That figure is 10.1 per cent higher than what it was the same month a year earlier.

CREA says the number was skewed higher because sales were significantly lower in some of Canada's largest and most expensive real estate markets this time last year, and that makes comparisons appear larger than they would otherwise have been.

"This phenomenon was particularly clear this month, with Greater Vancouver having posted the biggest year-over-year increase in activity by a large margin," CREA said.

Price gains were not distributed evenly across the country. There were strong increases in Toronto, Calgary and Vancouver, but prices fell in Winnipeg, Regina and Quebec City.

While prices were up significantly, the actual number of homes sold only inched up by 0.3 per cent during the month. That reverses a trend of five consecutive monthly declines. 

Home sales are 9.2 per cent below the recent peak seen in August 2013, but the housing group says it expects sales to pick up in the spring.

"Sales activity this spring will be supported by the recent decline in the benchmark five-year conventional mortgage rate," CREA's chief economist Gregory Klump said.

'Soft landing' ahead?

Despite the strong headline number in home prices, private economists also see some evidence for the "soft landing" narrative in the new housing data.

"The performance of Canada's housing market over the last few months is largely reflective of a cooling in Canadian housing demand," TD Bank economist Diana Petramala said. "Sales are moving at a pace that is neither too hot, nor too cold."

While every other part of the market is showing signed of slowing, it hasn't happened in prices yet largely because there's so little inventory that what homes do come up for sale often see bidding wars.

"The only thing that has not happened yet is a slowing in Canadian home price growth — but that too will likely come," Petramala said.