12 December 2018

Although certain industry specialists said the housing market could be stabilizing earlier this fall, rough November results made Tal believe the market still has a long way to go before it comes back to its status of a Canadian economy’s driver.

“As home sales in Toronto and Vancouver went down by annual 15% and 43% respectively in November, the real estate market now is far from stabilizing,” – he said. “Moreover, we are in the middle of an adjustment in both markets, and the high-rise segment will be the next to take a hit.”

While a more affordable condo market has been showing monthly gains in prices and sales, the low-rise sector in both of these cities has been facing difficulties all year.

Now, Tal and his colleague Royce Mendes expect the housing market to keep lagging Canada’s economy next year.

“We still predict that housing will be a drag on GDP in 2019, despite the BoC’s forecasts,” – says Mendes. “One more weak results report will strengthen our forecast of a pause in rate hikes during the next few months.”