Canadian House Price Rise Outstrips All But 3 Other Global Markets

Oct 1, 2015

The year-over-year rise in the price of Canada's housing in the second quarter of 2015 is one of the highest in the developed world, largely because of low interest rates, according to a report from Scotiabank.

At 8.3 per cent, it lags markets such as Ireland (13.3 per cent) or Sweden (10.1 per cent), but is well ahead of the U.S. (5.4 per cent) or U.K. (5.6 per cent).

The low Canadian dollar is increasing foreign demand for Canadian real estate, especially luxury real estate, said economist Adrienne Warren.

"Traditionally, popular markets for foreign buyers include the U.S., the U.K., Australia and Canada," Warren said in a report on global property trends.

"Foreign exchange considerations are taking on a bigger role, increasing the attractiveness of properties in countries whose currencies have weakened at the expense of relatively stronger currency markets in the U.S. and the U.K."

Australia and Canada are among the countries that have seen a weakening currency and an escalation of housing prices this year, especially in big urban markets such as Sydney and Melbourne.

Australian prices are up 8.3 per cent on the year, putting Canada in fourth place among the world's hottest markets.

Sydney now has the same affordability crisis that Vancouver is experiencing, with the median house price over $1 million Australian. With wealthy Chinese buyers finding property cheap, even after the devaluation of the yuan, there is continuing potential for prices to be pushed upward, especially luxury prices.

Reference: CBC News

http://www.cbc.ca/…/canadian-house-price-rise-outstrips-all…