Tag Archives: economic growth rate
Stephen Dupuis, Toronto Sun
Last week, I let readers in on the highlights of the inaugural address of the newly elected president of the Canadian Home Builders’ Association, Victor Fiume, of Durham Custom Homes.
BILD wishes Fiume well as he takes over the reins from Gary Friend, a Vancouver builder who led his industry at the national level with great distinction throughout one of the most challenging years ever faced by a CHBA president given the global economic crisis that dominated Friend’s tenure.
Fiume’s speech was given in Victoria, B.C., where spring was about a month ahead of schedule with the trees blossoming, the flowers pushing up and the grass green and growing.
As if picking up on the optimism that always comes with spring, the economic presentations we heard were quite encouraging. As Dr. Peter Andersen, consulting economist to the CHBA told builders, “fears of a double-dip recession have been put on the back-burner and it looks like we’re in for a sustainable recovery.”
Andersen declared that the recession ended in August, 2009, described 2010 as a “transition year” and said the true recovery would kick-in next year with 4-5% growth.
Unfortunately that economic growth rate will bring with it rising rates but that’s next year — for the balance of this year, Andersen sees rates as being on hold. Holding at the lowest levels in 50 years is a very good thing.
Further to the rosy forecast, Andersen noted that part-time employment is up adding that employers typically bring on part-timers as a prelude to hiring full-time.
Commenting on house prices, Andersen stated that he sees no sign of runaway prices and wondered out loud why all the fuss. “I don’t buy the bubble theory,” he stated. “Prices are just getting back to where they were before the economic crisis,” he added. Andersen also offered a very interesting perspective on the renovation market.
Where the conventional wisdom says that market may go down due to all the activity brought forward by the Home Renovation Tax Credit, he thinks that activity just primed the pump and now that homeowners have caught the renovation bug, they will just move onto the next project. Sounds plausible to me.
The good news is that Ontario builders were part of a British Columbia/Ontario sweep of the recent Canadian Home Builders’ Association Sales & Marketing (SAM) awards.
The bad news is that of the eight awards taken by Ontario builders, only two winners hailed from the GTA, but they are both deserving of a shout-out, so hats off to Empire Communities who got the award for Best Brochure/Kit for Fly Condos, besting builders from Victoria, Calgary, Ottawa and Hamilton.
A big tip of the hat to Bachly Construction of Bolton, Ont. who captured the award for Best Single Detached Home (over 4,000 sq. ft.) against heavy competition from Vancouver, Kamloops and Delta, B.C., as well as a place called Quispamiss, N.B.
The Bachly house is well worth checking out at www.bachly.com (click on featured home). Last but not least, BILD congratulates former local president Joe Valela of Valemont Homes on his election to the CHBA Executive Board, and Mike Cochren of Oakville-based Cochren Homes (and a RenoMark contractor) on his appointment to that board.
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Survey finds increases in 167 neighbourhoods, decreases in 21 while booming Saskatchewan posts the largest price increases. Conclusion is that Canada’s solid housing fundamentals contrast with boom-bust U.S.
House prices have remained a bedrock of value for Canadians over the past year, despite a steady flood of gloomy media headlines about the slowing Canadian economy, the volatility of the world’s stock markets, and the United States’ housing crash and credit crisis, according to a national survey by Century 21 Canada brokers.
The Century 21 Canada 2008 Spring National House Price Survey of typical homes in 198 neighbourhoods within 66 cities across Canada shows that prices over the past year have increased in 167 neighbourhoods, remained flat in nine neighbourhoods and declined in 21 neighbourhoods. Don Lawby, President of Century 21 Canada, says the survey results reflect the solid foundations of Canada’s real estate markets versus the boom-bust excesses of the U.S. housing market.
“The Canadian real estate market is based on conservative lending practices and regulations, strong banks and Canadians’ pride of ownership and diligence at building equity in their homes. These characteristics will sustain our real estate market as Canada’s economic growth rate slows this year,” says Lawby.
“The price collapse in the U.S. housing market, which happened 18 months ago, was based on lending practices and mortgage interest deductibility tax regulations that lured new buyers into mortgages they couldn’t sustain. Many existing homeowners took equity out of their homes and spent it on vacations, new cars and flat-screen televisions.”
“Over the past several weeks, I’ve visited every region of Canada and spoken with hundreds of realtors. Housing sales volumes are easing in most communities as the economic growth rate slows, but prices in the spring of 2008 are strong and stable nearly everywhere across the country,” says Lawby.
The Century 21 Canada 2008 Spring National House Price Survey reflects the price of a typical home in communities across Canada. A “typical home” is the type of home that occurs most frequently in any given neighbourhood. The homes selected for inclusion in the survey are based on the knowledge and experience of Century 21 brokers in each of the communities.
The Century 21 Canada 2008 Spring National House Price Survey found that the largest price increases over the past year occurred in Saskatchewan, where jobs in the booming oil and gas, grain and potash industries are attracting record numbers of new residents. Prices for typical homes have increased over the past year as much as:
• 57% to $330,000 for a modest 1,192-square-foot bungalow with three bedrooms and one bathroom in the Whitmore Park neighbourhood of Regina;
• 49% to $379,000 for a 1,440-square-foot split-level with three bedrooms and two bathrooms in the Avalon neighbourhood of Saskatoon; and
• 48% to $219,900 for a small 974-square-foot bungalow with three bedrooms and two bathrooms on a large lot in remote Prince Albert, a small city 140 kilometres north of Saskatoon known as “the Gateway to the North”.
Other strong markets across the country include:
• Winnipeg, where prices in the River Park South, West End and Charleswood neighbourhoods increased 19%, 24% and 34% respectively;
• Lethbridge, where prices in Southgate, Riverstone and Uplands neighbourhoods increased 21%, 21% and 23%;
• Castlegar, where prices in the south, north and rural areas of the city increased 16%, 18% and 18%;
• St. John’s, where prices in the east and west parts of the city increased between 9% and 19%; and
• Vancouver, where prices in the east, Yaletown, Kitsilano and Marpole increased between 5% and 19%.
In many communities, local conditions have produced strong, but variable price increases, including;
• Toronto, where a typical bungalow in North York increased 6%, while a typical condo in North York increased 20%. In Liberty Village, a condo increased 14%, while a bungalow in Scarborough Bluffs increased 11%.
• Montreal, where 11 neighbourhoods surveyed had increases ranging from 3% for a split level in Cote St. Luc and 11% for a two-storey in Riviere-des-Prairies.
• Halifax and Dartmouth, where 12 neighbourhoods surveyed had increases ranging from 5% for a split-level in Dartmouth Eastern Passage and 14% for a two-storey in Halifax West.
• Abbotsford, where prices for similar sized bi-level homes in the central, western and eastern parts of the city increased 2%, 7% and 8% respectively.
Softening markets across the country include:
• Edmonton, where prices in the south, west and south west parts of the city declined between 12% and 14%;
• Calgary, where four neighbourhoods had declines ranging from four% to 13% and three other neighbourhoods had zero, 3% and 9% increases;
• High River, located just south of Calgary, where prices in three neighbourhoods for a two-storey, a townhouse and a bungalow declined 4%, 5% and 9% respectively; and
• Mont Tremblant, where an alpine condo and a waterfront cottage declined 11% and 14% respectively, while a bungalow in the city increased 6%.