Us, Them & the Housing Market

The way things have been going, Torontonians and Vancouverites can’t be blamed for thinking housing markets are hot across the country. But according to several reports, “it ain’t necessarily so.”

Sure, the Toronto market is facing a record 2015, and Vancouver continues to post double-digit sales increases, but markets in many parts of Canada are moving at a different speed.

And as RBC’s senior economist Robert Hogue told The Globe and Mail earlier this year: “This sort of two-speed, if not multispeed, market is likely to be the central theme for the year.”

So how are other cities faring? Here are just a few examples: Resale markets in Alberta and Saskatchewan have indeed been weakened by the dramatic drop in oil prices, and Calgary, in particular, has suffered greatly from the rapid decline in prices.

In Montreal, real estate prices have been in a long-term slump, thanks to an over-supply of housing of all types, but activity has begun to stabilize. Even luxury properties are selling well in the city. Prices remain stagnant throughout Atlantic Canada. In Halifax, sales dropped to a 17-year low, thanks to a sudden increase in listings that seriously unbalanced the supply and demand pattern.

This picture may not change anytime soon. In a recent Globe and Mail article, BMO senior economist Sal Guatieri noted: “Strong demand from international migrants and young millennials, an influx of foreign wealth, and low mortgage rates are driving the two markets (Toronto and Vancouver).” And, so far, that’s not likely to change, either.