Factors that will drive growth in Canada’s housing market next year

There are several factors that will continue to drive growth and stability in the housing market in Canada for 2019 as per reports. Firstly, the real estate market is already stabilizing throughout much of Canada and this trend is expected to continue in 2019 as well. The home sales rate came down considerably in the months after the foreign buyer tax was introduced for Ontario. The OSFI had a stress test unveiled for uninsured buyers which had an impact from January 2018, lowering year-on-year sales volumes. Home prices also came down significantly from their peak levels in spring 2017 although they have since stabilized and have increased roughly by 2% (year-over-year) throughout Canada. Prices should increase moderately in 2019 and 2020 as per expectations while home sales have come closer to the 10-year average threshold over the last few months.

These are clearer signs of a balanced and stable real estate market in Canada which should be good news for the industry overall. Several buyers are also perceiving real estate as an attractive investment proposition again in Canada. Year-to-date hikes in home prices seem more rational if the stock market scenario this month is taken into account. The realty sector in Canada has been a solid and steady proposition for homebuyers in recent months again, something that should keep the housing market buzzing enough next year. Several alternative lenders have ample liquidity and this should also spur growth in the housing market in the near future.

Immigration rates are quite high in Canada and this will keep housing demand on the higher side over the next 10-15 years and even more as per reports, particularly in key metropolitan zones. Affordability of homes will continue to be a key aspect for regulators and authorities but this will balance out home sales while offering a prop to housing prices. Supply levels are not expected to catch up with overall housing demand over the next few years and hence the housing market in Canada should continue doing well in 2019.