StatsCan reported the country’s real estate industry has contributed to national GDP growth since 2000 more than the energy, manufacturing and healthcare industries combined.
The real estate sector – buying and selling property, and leasing and renting property – contributed almost $207.7 billion to Canada’s GDP in the month of August, representing 12.8 per cent of the total national GDP. That contribution rose a whopping 35.4 per cent over the last 10 years.
The next largest growth contributor was the construction sector – including the building of homes and office spaces – adding almost $114.8 billion to the national GDP in August, and rising 34.3 per cent over the last decade.
Comparatively, the growth in energy sector GDP, which includes mining and oil and gas, rose just 11.1 per cent from 2004 levels, while manufacturing dropped 9.8 per cent over the last 10 years.
The continuing increase in real estate, though, isn’t likely surprising anyone. Report after report suggests the rise in prices and sales isn’t going anywhere – especially in perpetually hot markets like Toronto and Vancouver.
“The market in Toronto will continue to do what it’s done: go up,” says David Fleming, an agent with Bosley Real Estate in Toronto. “I don’t think it’s unrealistic or surprising, and with the lack of available homes and low interest rates and the net migration … prices will increase across the board.”
Even in neighbourhoods that once relied on slower manufacturing industries – Hamilton, for example – are reportedly benefitting from strong real estate values.
“Hamilton’s employment has moved from a heavy emphasis on industrial manufacturing to medical and professional,” says agent and property investor Cameron Nolan, pointing to the city’s increasing popularity – and therefore strong housing market. “Hamilton has also got a strong young entrepreneur group of people, driven in some ways by the artistic community. It’s often young artists who drive the vibrancy in a community.”
It’s an industry that gets a lot of flak, but you’ll be happy to tell your friends that real estate is increasingly driving the Canadian economy.