Canada Immigration Push Fuels Rising Home Prices in Most In Demand Cities

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Canada's growing population, driven mainly by international migration, is increasing demand in the country's housing market, particularly in Toronto and Vancouver. Statistics Canada reported that almost all of the country's one million population growth in 2022 was due to migrants, prompting concerns about the impact on Canada's already tight housing market. The Canadian government is planning to welcome 1.5 million immigrants by 2025, but the challenge of inadequate supply remains. In March, Vancouver saw a 35% decrease in new listings compared to March 2022, while Toronto had the highest level of housing starts since 2012. However, the Greater Toronto Area's market remains tight, with a 44.3% drop in supply levels compared to last year.

The need for more housing in Canada is driven by the growing number of job vacancies and the desire to provide refuge for those escaping countries that have been devastated by war or natural disasters. Brendon Ogmundson, chief economist at the BC Real Estate Association, believes that Canada's population growth is the cause of inadequate supply and overwhelming demand in the housing market, leading to escalating prices. Despite construction completion, there is still a significant supply shortage, meaning that many households cannot afford to purchase homes. Vancouver estate agent Steve Saretsky argues that the government's policy of reducing demand through foreign buyer taxes and the federal mortgage stress test is misdiagnosing the problem, and the government needs to develop policies that cater to the demand for affordable family homes.

Read the full article on: REAL ESTATE MAGAZINE