Effect of oil prices can’t be ignored says Royal Le Page
Home prices will increase by around 2.9 per cent nationally but the slowdown in the oil industry is likely to mean more than one provincial story. Royal Le Page has published its latest House Price Survey and Market Survey Forecast for 2015 and sounds a largely optimistic note but CEO Phil Soper says: “In the immediate term we anticipate that the natural slowing of home price appreciation we called for in the third quarter of 2014 will be delayed in Central Canada and accelerated in the West by recent developments in the energy sector.” While oil may cause some weaker conditions for the western provinces Royal Le Page predicts that it will help some other areas. The firm predicts that the Greater Toronto Area will benefit from the largest major market price increases. For buyers the slowdown in prices in the west will allow some respite from the large rises seen in the last year, although Soper doesn’t expect that to last: “Over the longer term, we foresee a return to regional home price appreciation that is above both the historical average and national trends in general, when energy markets recover.” The study notes that there are still ongoing threats to the stability of the housing market including interest rate rises but also consumer confidence.