Prices for new homes in Canada are showing a record growth pace

The recent report by Statistics Canada shows that the pace of prices increase for new Canadian homes has reached a record level in more than 30 years.

Last month, new home prices were up by 1.9% from January, marking the fastest monthly gain since 1989.

Such results mean that Canada’s real estate markets are already overheated. Extremely low interest rates combined with reduced supply and strong demand for larger properties are pushing up sales and prices to new record marks.

“The current strength in new housing prices may be a problem for some potential buyers, as with higher prices the real estate becomes even less affordable. In addition to it, bidding wars keep overheating an already hot market,” – the report says.

Vancouver saw the largest new-home prices increase by 4%. However, the prices gains were seen in 22 of 27 cities. The annual growth reached 7%.

The report provides data on new single houses, semi-detached houses and townhouses, but not condos.