Canada Mortgage and Housing Corporation is adding its voice to those announcing a slowdown in Canada’s housing market.
The Crown corporation’s third quarter market review projects “measured” growth through the rest of this year and into next. CMHC sees a slowdown in housing starts and in price growth and points to “balanced” housing markets in most Canadian centres.
The CMHC forecast supports what already appears to be happening across the country. The Canadian Real Estate Association says its July figures indicate a balanced market.
Prices dropped a modest 2% from a year ago while sales remained virtually flat compared to June and new listings decreased a moderate 3.3% from June.
Still market watchers remain divided over the impact on the economy. Some point to the broader impact the housing industry has on employment and consumer spending. They say job losses from a slowdown in construction and the fact that falling home prices will have Canadians feeling less wealthy could be a serious drag on the economy. Several others see a 10% to 15% dip in home prices over the next two to three years as a modest contraction, especially compared to the vigorous and price growth experienced over the past decade.