In the Canadian Housing Market, Stable is the Word.
After three years of varied periods of growth and decline across the country, the Canadian housing market is starting to stabilize, according to the latest housing report released by Genworth Canada. While the economy continues to strengthen, modest growth in the housing market is the trend for the next five years.
The current condition is due in part to the tightening of regulations, but also continued warnings to consumers on their debt levels. Consumers appear to be heeding the advice and stabilizing their financial position before the Bank of Canada begins to raise its rate. The Spring 2013 Metropolitan Housing Outlook notes that healthy employment gains since the end of the recession have helped move mortgage payments in arrears and bankruptcies to a downward trend, except in British Columbia where payments in arrears have flattened after an upward trend from 2008 to 2010. Despite the low interest rates, price growth for both new and existing homes has been decelerating. The report also notes that while total mortgage approvals are falling, this decline is entirely fuelled by resale homes, as mortgage approvals for new homes increased by 3.4 per cent.
The Prairies are experiencing the strongest growth in home pricing, propelled by strong economic growth, rising employment and sustained residential demand.
Alberta saw the greatest population growth among the six regions, as well as housing starts surging to a post-recession high in 2012; housing starts are expected to continue to grow through 2013 and 2014.
Source Genworth Canada.
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