Bank of Canada: Housing “more robust than anticipated”
In its monetary policy report released yesterday the Bank of Canada admitted that some of our markets are far from a soft landing. The report noted that the market has rebounded following the very cold winter and benefitted from low interest and mortgage rates and that housing activity has been “more robust than anticipated”. However it is not a universal picture as we know. The BoC highlighted the differences between east and west, saying that the eastern provinces are more consistent with a soft landing, while cities in the west continue their growth. The bank believes the imbalance will carry on and the gap may get bigger. Experts suggest that as the market is not facing the same challenges everywhere in Canada, the BoC would be unlikely to introduce any ‘catch-all’ measures. Read the full story.
New report predicts market heat to continue well into 2015
A new report suggests that we are far from the end of market growth, at least in some parts of Canada. The annual Emerging Real Estate Trends report from the Urban Land Institute and PricewaterhouseCoopers says that Calgary, Edmonton, Toronto and Vancouver will continue to the “best bets” based on investment, housing and development. The report predicts that the overall real estate market in Canada will continue to be steady but in the hottest markets there is likely to be more upward trends in prices. In Vancouver for example, the figures suggest that 40 per cent of high-value property will be purchased by foreign investors; from Hong Kong and China predominantly. While the residential market may stay buoyant there aren’t such high hopes for the commercial sector. The report forecasts that there could be an oversupply of office units with landlords discounting rents. Read the full story.
Two-bedroom condos increasingly popular
Developers are building more two-bedroom condos in response to the demand from families and young professionals. With high-rise wooden developments expected to be approved by Ottawa there is predicted growth in this type of property, which offers more space at a lower cost, compared to a single-storey home. However demand is already pushing prices higher. RealNet Canada reports that developers are reversing a trend for smaller condos, which meant that in 2011 in Toronto 61 per cent of those offered for sale were one-bedroom units; now it is 46 per cent. Read the full story.