Even just a 1% increase in economic growth would boost Canada’s per person income by more than $19,000 – which would bode well for purchasing power and housing market activity.
In its new analysis, independent public policy think-tank Fraser Institute stated that an annual economic growth rate of 3% would pump around $45,150 into Canada’s per-person income after 20 years, ending up at a total of $105,029.
“Increased economic growth means improved living standards for Canadians, so economic growth remains an issue worthy of serious attention,” according to Fraser Institute senior fellow Steven Globerman, who also served as editor of the study titled The Costs of Slow Economic Growth.
“Given the importance of economic growth to household income in Canada, and to reducing social and political conflict, policymakers should prioritize faster economic growth,” he added.
From 2011 to 2018, Canadian GDP grew at an average annual rate of 2.17%. This represented a slight deceleration from the roughly 3% average observed from 2001 to 2010.
A recent report by real estate information portal Zoocasa noted that as much as 91% of Canadians believe that housing prices in their local markets have been rising faster than average incomes.
Moreover, 92% of the Zoocasa respondents said that this price growth has made it all but impossible for the average Canadian to enter into home ownership. More than four out of five (84%) Canadians consider real estate a crucial economic and political issue, and 78% argued that whatever party wins the federal elections should give housing affordability utmost precedence.