4 November 2019

Another reason is strong demographic demand for real estate.

2. Following a drop in 2019, home prices will start growing

Just like in case of sales, Canadian housing price growth has faced a significant hit during the previous two years. At the same time, the decrease was not as strong as with sales, that’s why the recovery will be faster. In CMHC’s opinion, unlike home sales, the growth drivers for home prices in 2020 will be Ontario and Quebec.

3. New home construction will not gain pace, but is still expected to stabilize

In 2017, home building reached a 10-year high, but has been falling since that moment. CMHC says the total number of home starts in 2019 is about the same it predicts for 2020 and 2021. It coincides with the historical average numbers. The economic forecast for Canada is optimistic for the next few years, so builders will be motivated to increase the construction pace. Nevertheless, CMHC says household formation will slow during that period, that’s why the strong labour market and income gain will not have such a strong influence as could.