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‘Worst in British Columbia may be behind us,’ David Rosenberg says of real estate Add to ...
Michael Babad
The Globe and Mail
Published Wednesday, Jul. 10 2013, 12:51 PM EDT
Last updated Wednesday, Jul. 10 2013, 1:09 PM EDT
These are stories Report on Business is following Wednesday, July 10, 2013.
Follow Michael Babad and the Globe’s top business stories on Twitter.
Housing market tame
Softer housing markets are going to eat into economic growth in Ontario, Quebec and British Columbia, according to new forecasts.
But “the worst in British Columbia may be behind us,” one economist says.
The residential real estate market is of huge concern in Canada, particularly since it began cooling a year ago with new mortgage restrictions brought in by the federal government.
Of late, it has illustrated signs of stability in the most recent indicators that include resale numbers, construction starts and building permits issued by municipalities.
“A soft landing at the national level masks regional disparities in housing market performance over the forecast horizon,” economist Jonathan Bendiner of Toronto-Dominion Bank said today.
“Outperforming markets will include those that can rely on above-average economic prospects – such as the Prairie provinces,” he added in his outlook.
“While Ontario, Quebec and British Columbia are expected to have their housing markets weigh on growth.”
Yesterday, Canada Mortgage and Housing Corp. reported a dip in housing starts in June, though construction remained strong. And earlier this week, Statistics Canada reported stronger issuance of building permits than had been expected. Add to that reports from several local real estate boards that suggest stability, as well, in the resale market.
“For all the horror stories out there surrounding Canadian residential real estate, the sector is actually holding in very well,” chief economist David Rosenberg of Gluskin Sheff + Associates said today.
“Note that the worst in British Columbia may be behind us as starts there shot up to 31,000 units from 23,000 in May to stand at the best level in a year,” he added.
The condominium market, particularly in Toronto, has been a big concern for many observers, including Finance Minister Jim Flaherty, who cited condos as an issue when he unveiled his latest round of mortgage rule tightening a year ago.
“I actually see the fact that multiple unit starts were down 15 per cent in Ontario as constructive news insofar as the data suggest that the condo builders are adjusting their construction schedules into line with new and lower sales realities, as such helping to forestall a more serious demand-supply imbalance and price erosion,” Mr. Rosenberg said today.
"Note that current permits and starts could still be responding, in the case of multiples, to pre-sales that took place months ago, so there could be a substantial lag before decelerating demand flows through to building."
Michael Babad
The Globe and Mail
Published Wednesday, Jul. 10 2013, 12:51 PM EDT
Last updated Wednesday, Jul. 10 2013, 1:09 PM EDT
These are stories Report on Business is following Wednesday, July 10, 2013.
Follow Michael Babad and the Globe’s top business stories on Twitter.
Housing market tame
Softer housing markets are going to eat into economic growth in Ontario, Quebec and British Columbia, according to new forecasts.
But “the worst in British Columbia may be behind us,” one economist says.
The residential real estate market is of huge concern in Canada, particularly since it began cooling a year ago with new mortgage restrictions brought in by the federal government.
Of late, it has illustrated signs of stability in the most recent indicators that include resale numbers, construction starts and building permits issued by municipalities.
“A soft landing at the national level masks regional disparities in housing market performance over the forecast horizon,” economist Jonathan Bendiner of Toronto-Dominion Bank said today.
“Outperforming markets will include those that can rely on above-average economic prospects – such as the Prairie provinces,” he added in his outlook.
“While Ontario, Quebec and British Columbia are expected to have their housing markets weigh on growth.”
Yesterday, Canada Mortgage and Housing Corp. reported a dip in housing starts in June, though construction remained strong. And earlier this week, Statistics Canada reported stronger issuance of building permits than had been expected. Add to that reports from several local real estate boards that suggest stability, as well, in the resale market.
“For all the horror stories out there surrounding Canadian residential real estate, the sector is actually holding in very well,” chief economist David Rosenberg of Gluskin Sheff + Associates said today.
“Note that the worst in British Columbia may be behind us as starts there shot up to 31,000 units from 23,000 in May to stand at the best level in a year,” he added.
The condominium market, particularly in Toronto, has been a big concern for many observers, including Finance Minister Jim Flaherty, who cited condos as an issue when he unveiled his latest round of mortgage rule tightening a year ago.
“I actually see the fact that multiple unit starts were down 15 per cent in Ontario as constructive news insofar as the data suggest that the condo builders are adjusting their construction schedules into line with new and lower sales realities, as such helping to forestall a more serious demand-supply imbalance and price erosion,” Mr. Rosenberg said today.
"Note that current permits and starts could still be responding, in the case of multiples, to pre-sales that took place months ago, so there could be a substantial lag before decelerating demand flows through to building."
