“Real estate remains the one positive driver of consumer sentiment in Canada,” said Nanos Research Group Chairman Nik Nanos. “Any negative changes in the real estate market would have a material downward impact on the confidence in the Canadian economy.”
The comments come as consumer confidence reached a five-week high, rising from 56.6 to 56.8, which according to Nanos, is the most optimistic reading since May and close to the previous high of 56.9.
They also follow new number from the Calgary Real Estate Board which notes that the volume of sales in June was only five per cent below the 10-year average for the month and three per cent higher than levels of the past three years.
“We’ve seen less concern from consumers lately,” said CREB president Corinne Lyall. “Consumers who were waiting for wide-spread price declines have been surprised to see that it just hasn’t happened yet, and so they’ve decided to take advantage of the improved selection and lower lending rates.”
What’s more, the share of people who expect home prices to fall in the next six months declined to the lowest since November at 13.2 per cent.
At a time where home sales in Vancouver and Toronto are escalating due to low interest rates and rising seasonal demand, the Bank of Canada’s deputy governor, Larry Schembri, said recently that the housing market is poised for a soft landing after a period of record prices and elevated consumer debt.
That sentiment falls in line with what a lot of agents and investors have been echoing for weeks as many are taking a wait-and-see approach to the real estate market with uncertainty in oil and other factors.
“I have seen our share of ups and downs, surely based on where the oil prices are right now but the market is stable,” Akbar Nimji, a real estate agent with Re/Max in Calgary, told CREW's sister publication REP.
“New immigrants definitely bring vitality to the real estate industry and we’re see the low to mid-range markets almost completely unaffected. In fact, there are still multiple offers on these types of homes.”
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Reduced concern about falling house prices due to the oil crash is losing steam, according to the latest poll from the Bloomberg Nanos Canadian Confidence Index, as consumer confidence grows.