Canada's Red Hot Market To Cool
Canada's Red Hot Market To Cool
TD Economics
CANADA’S RED HOT REAL ESTATE MARKETS TO COOL
HIGHLIGHTS
• Real estate delivered an outstanding performa over the past five years, with national home price growth averaging 10% annually.
• Cooler market conditions are anticipated over the course of 2008 and throughout 2009.
• This moderation will reflect the fact that the past rapid price appreciation has eroded affordability and has encouraged additional supply from new listings and new home construction. A weaker domestic economy will also contribute to the cooling.
• A soft-landing is anticipated. Indeed, with the Bank of Canada likely to cut interest rates further in 2008 and only gradually raise rates in late 2009, the risk of a significant or sustained correction in home prices is low.
The Bank of Canada today announced that it is lowering to 3 per cent so the Bank Rate is now 3 1/4 per cent.
Growth in the global economy has weakened, reflecting the effects of a sharp slowdown in the U.S. Growth in the Canadian economy has also moderated as buoyant growth in domestic demand, supported by high employment levels and improved terms of trade, has been substantially offset by the fall in net exports. The Bank is now projecting a deeper and more protracted slowdown in the
The Bank projects that the Canadian economy will grow by 1.4 per cent this year, 2.4 per cent in 2009, and 3.3 per cent in 2010.
The recent price-level adjustments for automobiles and the effect of past changes in indirect taxes will keep measured inflation below target through 2008. The emergence of excess supply in the economy should keep downward pressure on inflation through 2009.
Bank's Monetary Policy Report
Interested In Investing In Real Restate or Building Your Wealth Through Real Estate Go To:
