Housing markets to remain healthy despite shrinking economy – TD

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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.
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.
  • Raj Bakshi on 2016-05-27 9:34:54 AM

    The way things look in GTA and even surrounding areas like Oshawa, Clarington, New Market, Caledon, Cambridge, Guelph, Kitchener Waterloo, Hamilton and Niagara Falls. This trend is not going to stop. Even if gradual moderation strikes in later part of next yr. the prices will move upwards.
    The way economy seems heading and foreign investments are pouring because of our loonie and express entry immigration program. Bank of Canada has already sent signals that they are not going to be aggressive with rates untill home turn settles.

    There will not be long before GTA market closes price gap with Vancouver and other best places to live in the world. That would be the time for moderation growth.

  • Jasmine on 2016-05-27 4:24:36 PM

    Raj if I should guess, you must be a realtor. Good work. Get me five.

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