Overall Canadian prices rose 4.4%! This is the fastest increase we have had since 2003. Major drivers for this year-over-year price increase includes the following:
- Transportation up 9.1%
- Shelter up 4.8%
- Food up 3.9%
The cost of replacing home structures soared up just over 14%, being the fastest increase since the 80’s.
The driving force of rising prices is still isolated to gasoline and Canadian home prices which accounted for about half of the inflation. Supply shortages have definitely been a determinant putting upward pressure on home prices. These shortages are not likely to resolve quickly so the current elevated rate of inflation is expected to linger for a while.
The good news is that home prices are beginning to flatten out which should help the rate of rising inflation over the next year. Gas prices should slowly decline as well.
Even though this inflation may be putting pressure on the Bank of Canada we are still not expecting an increase in rate until the end of 2022!
*Source: British Columbia Real Estate Association
*Photo by Eduardo Soares on Unsplash