In this week’s real estate news in Canada, numerous trends have been affecting the housing market with an impact of great intensity. Here's a look at some of the week's impactful stories.
One of the week’s top stories tells us of the sales drop in the Canadian real estate following the rise in the borrowing rates:
Canadian Real Estate Sales Plummet as Borrowing Rates Steadily Rise
Canadian real estate sales made a huge drop in dollar volume. Sales through the MLS racked up to $224.04 billion in 2018, down 17.78% from the year before. Toronto and Vancouver represented a significant portion of that decline, but they weren’t alone. Only 6 Canadian markets with over $1 billion in sales saw a rise in dollar volume last year. Via betterdwelling.com
The real estate markets of Toronto and Vancouver are the leaders in the sales drop. Looking at the largest markets dropping dollar volumes across the country might give a misleading view of the national market though, as these two cities are so far removed from the rest of the country in scale.
On the other hand, the housing market's downward trend is a potential factor affecting the wider job market in Canada:
Unaffordable Housing Having Bad Impact on Canada’s Job Niche
A top-ranking official with Canada’s central bank suggests high housing costs are holding the country’s labour market back.
Bank of Canada Senior Deputy Governor Carolyn A. Wilkins says investing in employees through training and education, for example, is one way to boost the labour market — but it isn’t the only approach needed.
The availability of affordable housing plays an important part, too. – Via livabl.com
According to the central bank exec, supporting worker mobility is vital in improving the job market and
affordable housing is the key in this scenario. Unfortunately, many Canadians could not afford the housing costs especially in major employment areas such as Vancouver and Toronto.
Lastly, Alberta's biggest city continues to be a buyer's market. While it's much bigger than Fort McMurray, the relative proximity of Calgary makes it a good barometer for general confidence in the province as a whole:
Calgary Maintains Status as 2019’s Buyer’s Market
According to CREB’S Calgary Economic & Housing Outlook report released yesterday, Calgary’s real estate market in 2019 is firmly entrenched in a buyer’s market – and the city’s economic recovery will take most of 2019.
The report is quite clear about the cause of Calgary’s real estate market woes: economic uncertainty, oversupply, and stricter mortgage rules.
Last year’s mortgage stress test and increases in Bank of Canada’s overnight interest rates couldn’t have come at a worse time for Alberta. With a struggling economy, stagnant wages and high unemployment, it’s no wonder oversupply dominated the detached market in 2018 and is expected to continue until at least the end of 2019. – via zolo.ca
All property types are expectedly falling by 2.34%, with the revised mortgage
stress test rules being seen as the culprit behind the slowdown.
More important newsbreaks from the ever-changing Canadian real estate and housing market are coming next week!