Canadian Home Prices to See Slight Increases Over the Next Decade
A report from Global Edmonton reports TD Bank has predicted that a major slowdown will happen over the next decade to the hot Canadian market.
As of late, home prices have risen year-after-year at around a 7 per cent average. But until 2022, they are expected to simmer “several percentage points below the long-term average,” the report said.
Home average prices will rise, but only around 2 per cent, compared to the yearly average of 5.4 per cent since 1980.
The report said new regulation for borrowers, one of them being the amortization of a loan getting decreased from 30 to 25 years last summer, will contribute to the slowdown.
Also a factor: population. The population growth was growing at a rate of 1 per cent, but it’s expected to drop to 0.6 per cent in the near future.
“If the pace of population growth decelerates, one would expect that real estate price growth would slow down, as well,” TD said in a release.
And cities are starting to hit a saturation point too. But those cities that can make land available and see an influx of migrants should outperform the average the report said. Edmonton, Calgary, Toronto and Vancouver are amongst those cities pegged to outperform the average.
Just recently, a report from the Calgary Herald said the average cost of a house is at its all-time high in Calgary, as the Multiple Listing Service sale price average for a single-family home during the month of February was at $518,452, 10 per cent up from last year.
So there appears some saturation was abound to hit, which is good news for first-time home buyers. A lower-than-average rise may put Edmonton first-time home buyers in the buying market.