As reported by Michael Babad of The Globe and Mail
, TD forecast a shrinkage of 0.2 per cent in 2016, while other observers such as BMO Nesbitt Burns projected a more significant 1 per cent decline due to poor prospects of recovery in oil production.
TD economist Dina Ignjatovic emphasized that factors like stronger exports (due to the low loonie) and greater demand from the U.S. would keep Canada’s housing markets afloat despite the downturn.
“While we caution that the stronger the housing market becomes, the higher the risk of a correction down the road, we still expect it to remain healthy this year, moderating gradually over the second half of the year, and continuing to support domestic growth,” Ignjatovic said.
“This, combined with the resumption of oil production and the onset of reconstruction efforts in Alberta, should lead to a sizable rebound in economic activity in the second half of the year,” she added. “The economic slump in Canada isn’t expected to last long.”
Recent data has revealed that home sales volumes in Canada’s two most in-demand metropolitan markets (Vancouver and Toronto) have noticeably slowed down over the past year, although price growth is still showing no signs of stopping any time soon.
In defiance of several projections pointing at a slight slowdown in Canada’s economy later this year, the real estate sector is expected to remain robust and dynamic, according to the Toronto-Dominion Bank.