Welcome!

News Feed Item

No bubble to pop in Canada's housing market

OTTAWA, March 24, 2014 /CNW/ - Canadian house prices may be headed for a modest decline nationally and in some local markets, but fears of a housing bubble are exaggerated, according to The Conference Board of Canada's initial Housing Briefing: Bubble Fears Overblown.

"Mortgage costs, not just house prices, are the principal deciding factor for potential homebuyers," said Robin Wiebe, Senior Economist, Centre for Municipal Studies. "Mortgage rates are expected to rise this year, but not dramatically, because the Canadian economy remains in a slow-growth mode.

"The housing market may be undergoing a correction in some regions and market segments, but it is more likely to be a soft landing than a bubble bursting."

HIGHLIGHTS
  • Mortgage costs remain relatively low, which maintains affordability for home buyers.
  • Resale markets in major Canadian cities are generally balanced.
  • A soft landing in the Canadian housing market is the most likely scenario.

Fears of a housing bubble hinge on the ratio of house prices to apartment rents and house prices to incomes. The Conference Board's view is that while these ratios are high, they are also misleading. Better indicators of affordability are the ratio of mortgage payments to rents and mortgage payments to incomes, and neither presents much cause for alarm about a housing bubble.

In addition, Canadian employment continues to increase, albeit modestly, and the national population is growing. In general, housing starts are in line with demographic requirements, and markets do not appear to be overbuilt. Total housing starts in Canadian cities with at least 10,000 residents ended 2013 at just below 170,000 units. Although down from nearly 194,000 starts in 2012, this is in line with Canada's 25-year average.

Furthermore, a low proportion of Canadian mortgages are in arrears. As a result, a market downturn in Canada would not be amplified by a wave of "distressed" home sales, as occurred in the United States in the 2000s.

Over the medium-term, a modest market correction, particularly in market segments in Ontario and Quebec as projected rising interest rates potentially crimp affordability, could produce a moderate decline in the national average housing price.

The outlook provides assessments of six major Canadian markets.

  • Vancouver's resale market moved back into balance last spring. Sales were up briskly from a year earlier in each of the last three months of 2013. Prices are also growing strongly, although the current pace is unsustainable and slower advances are expected in 2014.
  • Calgary's resale market is approaching sellers' conditions. Sales have not fallen on a year-over-year basis since April 2011, and price growth accelerated sharply last year.
  • Edmonton's resale market is balanced. Sales rose briskly in 2013 and price growth is picking up along with sales.
  • Toronto's resale market is balanced. Sales stabilized in June 2013, and rose on a year-over-year basis during each of the six months leading up to the end of 2013. Price growth remains healthy and a major price correction is hard to envision, given solid employment and population growth. While the condominium market is at some risk, a soft landing appears to be the most likely scenario.
  • Ottawa's resale market is balanced. Falling employment is contributing to sluggish resale conditions. Sales were largely flat last year, but prices continue to rise gently. Total housing starts remain soft by historical standards.
  • Montréal's resale market is flirting with buyers' territory. Sales and average prices were largely below year-earlier levels in 2013. Both single-detached and multi-family starts slowed last year.


 

SOURCE Conference Board of Canada

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Using new techniques of information modeling, indexing, and processing, new cloud-based systems can support cloud-based workloads previously not possible for high-throughput insurance, banking, and case-based applications. In his session at 18th Cloud Expo, John Newton, CTO, Founder and Chairman of Alfresco, described how to scale cloud-based content management repositories to store, manage, and retrieve billions of documents and related information with fast and linear scalability. He addres...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management solutions, helping companies worldwide activate their data to drive more value and business insight and to transform moder...
SYS-CON Events announced today that eCube Systems, a leading provider of middleware modernization, integration, and management solutions, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. eCube Systems offers a family of middleware evolution products and services that maximize return on technology investment by leveraging existing technical equity to meet evolving business needs. ...
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the protocols that communicate data and the emerging data analy...
Digital innovation is the next big wave of business transformation based on digital technologies of which IoT and Big Data are key components, For example: Business boundary innovation is a challenge to excavate third-party business value using IoT and BigData, like Nest Business structure innovation may propose re-building business structure from scratch, as Uber does in the taxicab industry The social model innovation is also a big challenge to the new social architecture with the design fr...
Fifty billion connected devices and still no winning protocols standards. HTTP, WebSockets, MQTT, and CoAP seem to be leading in the IoT protocol race at the moment but many more protocols are getting introduced on a regular basis. Each protocol has its pros and cons depending on the nature of the communications. Does there really need to be only one protocol to rule them all? Of course not. In his session at @ThingsExpo, Chris Matthieu, co-founder and CTO of Octoblu, walk you through how Oct...
We’ve been doing it for years, decades for some. How many websites have you created accounts on? Your bank, your credit card companies, social media sites, hotels and travel sites, online shopping sites, and that’s just the start. We do it often without even thinking about it, quickly entering our personal information, our data, in a plethora of systems. Sometimes we’re not even aware of the information we are providing. It could be very personal information (think of the security questions you ...
Complete Internet of Things (IoT) embedded device security is not just about the device but involves the entire product’s identity, data and control integrity, and services traversing the cloud. A device can no longer be looked at as an island; it is a part of a system. In fact, given the cross-domain interactions enabled by IoT it could be a part of many systems. Also, depending on where the device is deployed, for example, in the office building versus a factory floor or oil field, security ha...
Is your aging software platform suffering from technical debt while the market changes and demands new solutions at a faster clip? It’s a bold move, but you might consider walking away from your core platform and starting fresh. ReadyTalk did exactly that. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, will discuss why and how ReadyTalk diverted from healthy revenue and over a decade of audio conferencing product development to start an innovati...
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of So...
SYS-CON Events announced today that Niagara Networks will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Niagara Networks offers the highest port-density systems, and the most complete Next-Generation Network Visibility systems including Network Packet Brokers, Bypass Switches, and Network TAPs.
Data is an unusual currency; it is not restricted by the same transactional limitations as money or people. In fact, the more that you leverage your data across multiple business use cases, the more valuable it becomes to the organization. And the same can be said about the organization’s analytics. In his session at 19th Cloud Expo, Bill Schmarzo, CTO for the Big Data Practice at EMC, will introduce a methodology for capturing, enriching and sharing data (and analytics) across the organizati...
There is little doubt that Big Data solutions will have an increasing role in the Enterprise IT mainstream over time. Big Data at Cloud Expo - to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA - has announced its Call for Papers is open. Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is...
IoT is fundamentally transforming the auto industry, turning the vehicle into a hub for connected services, including safety, infotainment and usage-based insurance. Auto manufacturers – and businesses across all verticals – have built an entire ecosystem around the Connected Car, creating new customer touch points and revenue streams. In his session at @ThingsExpo, Macario Namie, Head of IoT Strategy at Cisco Jasper, will share real-world examples of how IoT transforms the car from a static p...
SYS-CON Events announced today that Tintri Inc., a leading producer of VM-aware storage (VAS) for virtualization and cloud environments, will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Tintri VM-aware storage is the simplest for virtualized applications and cloud. Organizations including GE, Toyota, United Healthcare, NASA and 6 of the Fortune 15 have said “No to LUNs.” With Tintri they mana...