Residential Real Estate - Canada

Canada

In Canada, the Residential Real Estate market market is forecasted to reach a staggering value of €6.01tn by 2024.
This projection is based on the anticipated annual growth rate of 4.11% from 2024 to 2029, which would result in a market volume of €7.35tn by 2029.
When comparing the global market, it is noteworthy that China is expected to generate the highest value in the Real Estate sector, with an estimated worth of €103.6tn by 2024.
The Canadian residential real estate market is experiencing a surge in demand due to low interest rates and an influx of foreign investment.

Key regions: Europe, Brazil, France, Asia, United States

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Analyst Opinion

The Residential Real Estate market in Canada is experiencing significant growth and development.

Customer preferences: Customers in Canada are increasingly looking for properties that offer both affordability and value for money. They are also seeking properties that are located in desirable neighborhoods with access to amenities such as schools, parks, and shopping centers. Additionally, there is a growing demand for properties that offer energy efficiency and sustainable features.

Trends in the market: One of the key trends in the Canadian Residential Real Estate market is the increasing popularity of condominiums. Condos are becoming a preferred choice for many homebuyers, especially in urban areas, due to their affordability and low maintenance requirements. This trend is driven by the rising prices of single-family homes and the desire for a more convenient lifestyle. Another trend is the growing interest in real estate investment. Many Canadians are investing in residential properties as a means of generating passive income or as a long-term investment strategy. This trend is fueled by low interest rates, favorable tax policies, and the stability of the Canadian housing market.

Local special circumstances: One of the unique factors influencing the Residential Real Estate market in Canada is the impact of immigration. Canada has a strong immigration policy and attracts a significant number of immigrants each year. This influx of new residents contributes to the demand for housing, especially in major cities like Toronto and Vancouver. As a result, the market is experiencing increased competition and rising prices in these areas. Another special circumstance is the influence of government policies and regulations. The Canadian government has implemented measures to cool down the housing market and prevent a housing bubble. These policies include stricter mortgage stress tests, foreign buyer taxes, and limitations on speculative investments. While these measures have had some impact on the market, the demand for housing continues to remain strong.

Underlying macroeconomic factors: The Residential Real Estate market in Canada is influenced by several macroeconomic factors. One of the key factors is the overall strength of the Canadian economy. When the economy is performing well, with low unemployment rates and stable economic growth, there is increased demand for housing. Conversely, during economic downturns, the demand may decrease. Interest rates also play a significant role in the Residential Real Estate market. Low interest rates make borrowing more affordable, which encourages homebuyers to enter the market. Conversely, high interest rates can deter potential buyers and slow down the market. In conclusion, the Residential Real Estate market in Canada is experiencing growth and development driven by customer preferences for affordability, value for money, and desirable locations. The market is also influenced by trends such as the popularity of condominiums and real estate investment. Special circumstances such as immigration and government policies further shape the market. Finally, macroeconomic factors like the strength of the economy and interest rates play a significant role in the market's performance.

Methodology

Data coverage:

Figures are based on total and average value of residential real estate, residential estate transactions and leases.

Modeling approach:

Market size is determined by a combined top-down and bottom-up approach. We use national statistics, international organizations, and industry associations to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country specific industry associations such as GDP, price level index, household wealth, household size, number of renter and owner households, housing consumer spending per capita.

Forecasts:

We use a variety of forecasting techniques, depending on the behavior of the market, for instance, exponential trend smoothing. The main drivers are GDP per capita, population, number of renter and owner households, price level index, housing consumer spending per capita.

Additional Notes:

Data is modeled using current exchange rates. The market is updated twice per year in case market dynamics change. The impacts of the Russia-Ukraine war are considered at a country-specific level.