Housing Markets Moderating: Canada’s Two-Year Housing Outlook
The Conference Board of Canada,
October 21, 2021
This quarterly economic forecast presents the medium-term outlook for the Canadian economy. This release focuses on housing. For an overview of all major components of the economy, go to the Canadian Outlook main page.
- Canadian housing markets are throttling back following months of frenetic activity. Still, key underpinnings, such as mortgage interest rates, employment growth, and household formation, remain generally supportive.
- The pandemic led to a massive increase in the number of people working from home and boosted demand for homes outside big cities. This could continue, further increasing residential demand in smaller centres.
- Canada’s average resale price has peaked for now but will end 2021 up a record 24.2 per cent. We expect modest dips through 2023 and a peak-to-trough price drop of 10 per cent.
- Canadian housing starts will hit a record-high 275,100 units in 2021, then ease to a still strong 236,500 units in 2022.
- Residential investment has become a large component of GDP; its recent pullback and slow-growth prospects could be a significant economic drag.
Table of Contents
Markets Come Off the Boil
Forecast Underpinnings: Interest Rates and the Job Markets