The economist warns that the rise in sales in Vancouver is a temporary jump while the slowdown in Toronto’s larger market is indicative of a price correction.
Madini says that the impact is likely to be felt outside the housing market with a drag on second-quarter GDP, perhaps taking it to just 1 per cent; but if not then the longer-term outlook “appears to be worsening.”
There could be a reduction in housing investment, lower consumer consumption and financial stability could even be impacted.
More market update:
Canada’s hottest housing markets are heading towards a severe downturn according to Capital Economics’ David Madini.