Maintaining a high quality of life has become a challenge for Canadians facing higher prices for basic necessities, with shelter costs representing a significant and rising expense for many households. The latest inflation report showedinterest costs increased 25.4 per cent year-over-year in March, while rent prices jumped 8.5 per cent year-over-year.
You mentioned that you expect home prices will increase modestly, meaning single-digit year-over-year changes?Now, the Bank of Canada is paying attention to what’s happening in the housing market, and if it sees a market that starts to rebound very vigorously and price activity that starts to point toward an overheating in the market, it may be a factor that might push the bank to hold off on the pace of rate cuts that we’re expecting.
Lastly, I think it’s really important to put a lot of emphasis in changing the housing mix that we build and have more rentals, because when we do projections for the coming years, our view is that demand for rental apartments is going to skyrocket. So we need to build a lot more purpose-built apartments as well as social housing, because a lot of Canadians will not even be able to afford market rent given the affordability crisis that we have.
It’s very hard to tell. The pressure on our housing stock comes from household formation. When you have a new household being formed, they need a housing unit. When you have pressures coming from affordability and this big boom in immigration, for example, it basically made people bundle up. They get together and several of them live in one housing unit. So they’re not revealing how many units would be ideal.
What we’ve seen in terms of preconstruction sales is that market completely came to a halt when interest rates went to a very high level over the past year-and-a-half – and this is not rebounding yet. What that implies is that the pipeline in new projects that will get started at some point is getting thin. But in terms of what is being started, what is being worked on, those numbers I would argue are historically robust – not enough relative to what we need, but they’re still pretty robust.
Demand Housing Canada Supply Bank Cent Measure Bank Of Canada Globe Calgary
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