Canadian prices, as measured by the Consumer Price Index (CPI), rose 3.4 per cent on a year-over-year basis in May, down from 4.4 per cent in March. The decline was mostly driven by lower gasoline prices from this time last year (-18.3 per cent). Month over month, CPI rose 0.4 per cent, in large part due to higher mortgage interest and traveler accommodation costs. Shelter costs were up 4.7 per cent year over year, driven by much higher mortgage interest costs (up 29.9 per cent from last year) along with higher rents (up 5.7 per cent from May 2022). The homeowner's replacement cost, which tracks home prices, was down 0.1 per cent year over year. Grocery prices were up 9 per cent year over year, down from 9.1 per cent last month. In BC, consumer prices rose 3.4 per cent year-over-year.

After unexpectedly hot inflation in April, the CPI cooled in May, with year-over-year prices rising at the slowest rate since June 2021. Much lower gasoline prices compared to the same time last year are doing much of this work, but recovering supply chains also contributed, with furniture and household appliances both on average cheaper than the same time last year. The Bank of Canada's measures of core inflation, which strip out volatile components, are trending downwards and are now mostly below 4 per cent year-over-year. Despite this progress, other components of the CPI remain stubbornly high, particularly food and shelter costs. Excluding energy prices, the CPI was up 4.6 per cent from last year, a rate that is still well beyond the Bank's target. In the context of solid GDP growth, a robust labour market, and a rebounding housing market, financial markets expect that the Bank will raise its benchmark interest rate by another 25 basis points to 5 per cent at its next meeting on July 12th. 


In the first quarter of 2023, the BCREA Commercial Leading Indicator (CLI) held steady at 148, while the six-month moving average continued its downward trajectory to 149. Compared to the same quarter in 2022, the index was down by 5 per cent.   

It is important to note that the environment for commercial real estate remains highly abnormal and uncertain. The CLI is designed to interpret economic and office employment growth as positive indicators for commercial real estate demand. However, the recent strong growth in these indicators may not translate as readily into improved commercial real estate market conditions due to structural changes in the economy caused by the COVID-19 pandemic. 

The CLI held steady due to an improvement in the financial component, completely offsetting a decline in employment, while the economic component was essentially unchanged. Spreads between corporate and government borrowing costs declined in the first quarter while Real Estate Investment Trust (REIT) prices rose, strengthening the financial component of the index. In contrast, the employment component of the index fell due to declines in both office employment (finance, insurance, and real estate) as well as manufacturing employment. Finally, the economic component of the index was essentially unchanged as rising wholesale trade was entirely offset by declining inflation-adjusted retail sales and manufacturing sales. 

Reciprocity Logo The data relating to real estate on this website comes in part from the MLS® Reciprocity program of either the Greater Vancouver REALTORS® (GVR), the Fraser Valley Real Estate Board (FVREB) or the Chilliwack and District Real Estate Board (CADREB). Real estate listings held by participating real estate firms are marked with the MLS® logo and detailed information about the listing includes the name of the listing agent. This representation is based in whole or part on data generated by either the GVR, the FVREB or the CADREB which assumes no responsibility for its accuracy. The materials contained on this page may not be reproduced without the express written consent of either the GVR, the FVREB or the CADREB.