Why our young may save the housing market from tumbling
Nicolas Johnson – Globe and Mail
Here’s one more factor buoying average home prices: young and middle-aged adults.
Canada stands out among the 34 countries in the Organization for Economic Co-operation and Development with one of the fastest growth rates in housing prices since 2007, note Stéfane Marion and Matthieu Arseneau, economists at National Bank Financial Inc.
Low interest rates and decent job creation have helped boost prices, the economists said in a report. But what distinguishes us from the rest of the OECD is the rate of increase of people aged 20 to 44, an important group for home buying and renting. That group is shrinking on average among OECD countries, but growing in Canada.
“The growth rate for the population group aged 20 to 44 is particularly important for the housing market since this is the age cohort generally associated with marginal demand for a residential asset,” the economists said.
“After a period of stagnation since the mid 1990s, population growth for people aged 20 to 44 has picked up very notably since 2007,” the economists said. “Importantly, even if the rate of growth is expected to crest in 2013, it will still remain positive over the next decade. This argues against precipitous fall in home prices.”
Contact the Jeffrey Team for more information – 416-388-1960
Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.