In her report, TD economist Diana Petramala said that Vancouver’s housing market is predicted to grow by a modest 7 per cent in 2016, with an actual decrease of 2 per cent next year. These numbers accompany a significant 20 per cent increase in median home prices in the region last January.
The report noted that Vancouver and other high-volume locales such as Toronto are especially at risk due to volatility induced by factors like adjustments to borrowing rates in lockstep with the U.S. Federal Reserve’s tightening measures, saying that “some payback following banner years” is not unexpected.
Petramala assured market players, however, that while a cooling is inevitable at some point in the industry’s life cycle, a housing crash remains a low possibility.
“Toronto and Vancouver are likely benefiting from foreign investment inflows, which are expected to remain strong (or strengthen further) in light of a depressed Canadian currency (which makes housing cheaper in many better performing foreign currencies),” Petramala stated in the report, as quoted by VanCity Buzz
Buttressing the overall health of Canadian real estate is the stability in home prices in most regions. The TD report added that cross-province movers are also emerging as major drivers for transaction volume in Ontario and British Columbia.
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Despite the robustness of Canada’s real estate sector, brokers and consumers alike should prepare for a relative cooling of the nation’s traditionally in-demand markets this year, a leading economic analyst said on Thursday (February 11).