SOURCE: Scotiabank


October 09, 2014 08:00 ET

Scotiabank: Global Housing Recovery Remains Uneven

TORONTO, ON--(Marketwired - October 09, 2014) - The performance of global residential property markets in 2014 remains very uneven, according to the Scotiabank Global Real Estate Trends report released today. In North America, the Canadian housing market overall is well balanced, while the U.S. housing recovery is proceeding at a gradual pace.

"We anticipate a more balanced global property market in 2015," said Adrienne Warren, a Senior Economist at Scotiabank. "A gradual normalization of interest rates will pressure affordability in some high-priced markets such as Australia, the U.K. and Canada, contributing to more moderate price appreciation."

According to the report, improving global economic prospects and aggressive monetary policy easing should help stabilize some of the hardest hit property markets in Europe. More moderate price increases, rising rents and pent-up demand will extend the U.S. housing recovery.

"Strengthening regional growth should also help firm up property markets in emerging Asia, including India and Thailand," added Ms. Warren. "Relatively healthy economic conditions will continue to support housing demand in Peru, Chile and Colombia, while Mexico's property market should benefit from recent interest rate cuts, domestic market reforms and an improving U.S. growth outlook."

Highlights in the report include:

  • Canadian national sales and price trends are skewed by relatively strong activity in several of the largest and priciest housing markets -- primarily Toronto, Calgary and Vancouver. The median house price increase across Canada's major centres this year is just under 3% year-over-year (y/y), less than half the national average increase of 7%.
  • In the near term, the persistence of low interest rates points to continued upside risk to home sales, construction and prices. However, cyclical and structural factors suggest Canada's housing sector has more downside than upside risk over the medium term.
  • Demographic trends also are expected to be less favourable for Canadian housing demand over the medium term. The key first-time home-buying age cohort (25-34 years of age) is unlikely to be as supportive as it has been during the recent housing boom, while an aging population should reduce household formation and housing turnover.

Read the full Scotiabank Real Estate Trends Report online at:,,3112,00.html.

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