Scotiabank's Economics department released a report on the state of the Canadian and US housing markets on Wednesday. The highlights were:
- Expected continuing relative strength in Canada versus the US housing market
- Some softening of demand as "pent up demand" has been met and prices are unaffordable
- The differential between the typical monthly mortgage payment on a new home and the average rent on a two-bedroom apartment is close to $800, its highest level since the early 1990s.
- Affordability will likely be a constraining factor on first-time buyer activity in four of the 23 centres: Victoria, Vancouver, Calgary and Toronto. In each of these cities, the buy-versus-rent premium approaches or exceeds $1000.
At this late stage in the cycle, affordability favours lower-priced multiple-unit housing such a condominiums over single-detached homes. “Move up” buyers who have already built up equity in their homes will likely be more active than first-time purchasers. Renovation activity should outpace new construction and sales, sustained by the record number of existing home sales in recent years.TD Economics released their analysis of the Canadian Housing Starts release on Thursday. The highlights were:
- After January’s surge, retreat was expected
- Decline is broad-based across singles, multiples, and regions
- Annualized rate of building starts is trending below 200,000 units now after two years of record high starts.
- YOY price gains for new construction are trending above 10% over last year.