There is no denying that in certain regions, especially oil-sensitive markets, the decrease in economic growth has been felt. But, the gradual growth in places such as Toronto and Vancouver have shown the degree in how real estate supports the economy Canada wide.
With newly built homes and the buying process, we understand the need for accessible information online. With real estate purchasing, we can see many different sectors of this industry being an active part of the sale. In fact, Canadian home sales actually push higher in 2016 as a CREA Report states how February paves new perspectives.
Despite the weak projections that real estate has been experiencing over the past year, Canada’s economy emerged stronger than anticipated in the fourth quarter of 2015. One of the main factors we have to thank is real estate, due to the industry’s steady growth in our gross domestic product (GDP).
Limited data exists on the specific impact between newly built homes sales and those of used homes. This creates a value of amalgamating the statistics of both home types and understanding the position it holds within Canada’s national GDP.
Statistics Canada has recently shown that the GDP has grown by 0.8 % in 2015’s fourth quarter, totalling an annual GDP growth of 1.2 %. Housing accounted for a whopping $7.4 billion increase in GDP, which is about half of Canada’s economic growth in 2015.
If you weren’t sure how real estate affects our economy, consider this: real estate GDP is the most consistent with growth in comparison to other industries. The GDP rate grows steadily for the home industry, while other industries such as manufacturing and oil and gas tend to fluctuate.
A large reason for this GDP in real estate has to do with the value that a buyer is willing to pay rather than the cost that the seller incurs to create it. This is referred to as imputed rent. Imputed rent accounted for an astounding $4 billion in real estate GDP, and much of the overall GDP in Canada.
Buying a home is a large sector of our economy, and the rising prices in the Canadian housing market over the past decade will eventually subside.