Canadian Housing Market Shows Signs of Life
The Canadian housing market has been experiencing a downturn, but new data released this morning indicates a potential turnaround. The Teranet-National Bank House Price Index has edged up for the first time in eight months, with a 0.4 percent increase in August.
Factors Influencing the Housing Market
Economist Daren King notes that despite the expected further cuts by the Bank of Canada, it’s still too early to determine if this trend will continue. Several factors will continue to weigh on the housing market, including:
- Continuing uncertainty
- Moderating population growth
- The risk of persistently high long-term interest rates
- A potentially further deterioration in the labour market
Regional Price Changes
The index, which tracks price changes on sales of the same properties over time, reported price increases in several cities, including:
- Winnipeg
- Hamilton
- Toronto
- Ottawa-Gatineau
- Halifax
However, since the end of last year, the national index is still down 4.6 percent.
Affordability and Market Resilience
According to King, "Against the backdrop of the current trade dispute, market resilience has depended on differing levels of affordability." This suggests that affordability has been a key factor in the resilience of the housing market in Canadian cities.
Conclusion
While the latest data release shows a slight uptick in the housing market, it’s essential to consider the various factors that can impact the market’s trajectory. As the economy continues to evolve, it’s crucial to monitor the housing market closely to determine if this trend will persist. Only time will tell if the Canadian housing market has truly turned a corner.
