How home flipping is impacting Canadian real estate
Real estate brokerage Royal LePage said house prices in Canada is forecasted to climb in the next three months as the USMCA trade deal boosts confidence in the job market and consumers consider larger purchases.
Royal LePage expects the aggregate price of a home in the country to rise by 1.5 per cent in the fourth quarter from the previous year. The average price of a home in Canada rose 2.2 per cent in the third quarter to $625.499.
"Positive economic fundamentals, supported by a new agreement on trade, should bolster consumer confidence across Canada and stoke demand in the nation's real estate market," said Phil Soper, president and CEO of Royal LePage in a statement on Tuesday.
"More confident that their jobs are secure, the new USMCA agreement has removed a widespread veil of uncertainty that was acting as a drag on large purchase decisions."
After months of intense negotiations, the federal government reached an agreement with the U.S. and Mexico on a new trilateral trade pact earlier this month that is expected to be ratified by the end of this year.
Even though the trade deal paves the way for the Bank of Canada to raise interest rates, Soper said the agreement is a positive development for housing industries on both sides of the border.
“Job growth is strong, Canada is attracting more of the best and brightest from around the world and the large millennial cohort is putting increasing pressure on our limited new housing stock,” Soper said. “It is imperative that all levels of government address looming supply shortages, particularly in affordable housing."
The jump in house prices across Canada in the last three months were driven by gains in the greater Montreal and Vancouver areas, while Toronto reported year-over-year declines.