Fears of baby boomers selling homes ‘overblown’
Ashley Ford
Province
Looking for home price relief?
Forget about it for the next 25 years.
Average house prices will rise four per cent annually over the next quarter of a century across Canada — and likely more than that in Greater Vancouver, TD Economics said in a report released yesterday.
“Our report confirms the old adage that real estate is all about location, location, location,” said Craig Alexander, deputy chief economist of TD Bank Financial Group.
In centres such as Greater Vancouver where land is scarce, the price hikes will be above average, TD said.
Victoria, Toronto and Montreal are also expected to see larger-than-average annual price jumps.
But Alexander hedges his bets on the immediate future for Western Canada’s three major cities.
“There is no question that the recent dramatic price growth in Vancouver, Calgary and Edmonton is unsustainable, and this poses risks in the near-term,” he said.
“Nevertheless, over the long haul, property values in these urban centres should do well,” he said.
Slowing population growth will be offset by rising home-ownership rates, growing personal income, a lower long-term rate of unemployment and more modest construction of new homes, TD said.
“Fears that baby boomers will severely depress housing markets as they sell their properties are overblown,” Alexander said.
Separately, the Conference Board of Canada’s latest Metropolitan Outlook also sees few economic clouds ahead for Greater Vancouver.
It projects economic growth of 3.5 per cent this year and next, 3.4 per cent in 2008, 3.5 per cent in 2009 and 3.4 per cent in 2010.
© The Vancouver Province 2006
