10 January 2018

Robert Kavcic, an economist at Bank of Montreal in Toronto, says a hot year for the housing starts was “pushed by strong demographic support and stable job markets in Canada’s biggest provinces.”

The last year’s gains were broad-based: Ontario reported the largest number of housing starts since 2004, while British Columbia hit a record. Moreover, Alberta showed gains for the first time since the oil prices crash in 2014.

The market demand is still strong across the country even despite record high prices in the Toronto region. The Canadian Real Estate Association says national home prices rose by 9.3% in a year. As a result, the five year hike reached 48%. Real estate prices in Toronto were up by 8.4% during the previous year.

Nevertheless, we may see a slowdown this year, as stricter mortgage rules take effect and the central bank may raise its key lending rate.

“As we have a record high number of housing starts in 2018, a more moderate demand restrained by tighter rules and a possibility of rate hikes coming, the activity may slow down this year,” – Kavcic noted.