The wealth effect of the Toronto and Vancouver ‘housing party’
Some of us are still feeling rich because of the housing boom in parts of the country, which should mean we’re going to spend.
But only to a point. And only in certain cities.
What all of this means, according to Toronto-Dominion Bank, is that markets for new and existing homes should continue to help prop up Canada’s flagging economy until mid-2016.
TD economist Diana Petramala looked at both the levels of housing starts and resale numbers.
While construction starts slipped in January, for the second month in a row, the “trend level” has been steady at an annual pace of about 200,000 since September, she said.
“As such, every house started will boost real GDP for the following four quarters,” Ms. Petramala noted.
“New home construction should contribute positively to real GDP growth at least for the next six months even as housing starts edge down over the course of 2016.”
Then there’s the resale market, and numbers suggesting “that the Toronto and Vancouver housing party rolled into the new year, offsetting what has been extreme weakness in commodity-heavy markets.”
The wealth effect of the Toronto and Vancouver ‘housing party’ - The Globe and Mail
Some of us are still feeling rich because of the housing boom in parts of the country, which should mean we’re going to spend.
But only to a point. And only in certain cities.
What all of this means, according to Toronto-Dominion Bank, is that markets for new and existing homes should continue to help prop up Canada’s flagging economy until mid-2016.
TD economist Diana Petramala looked at both the levels of housing starts and resale numbers.
While construction starts slipped in January, for the second month in a row, the “trend level” has been steady at an annual pace of about 200,000 since September, she said.
“As such, every house started will boost real GDP for the following four quarters,” Ms. Petramala noted.
“New home construction should contribute positively to real GDP growth at least for the next six months even as housing starts edge down over the course of 2016.”
Then there’s the resale market, and numbers suggesting “that the Toronto and Vancouver housing party rolled into the new year, offsetting what has been extreme weakness in commodity-heavy markets.”
The wealth effect of the Toronto and Vancouver ‘housing party’ - The Globe and Mail