RBC Economics says the current housing market correction will be supported by immigration and shrinking household size.
These factors will lessen the chance of a long slowdown comparable to the one seen in the United States during the great financial crisis of 2008.
RBC says that demand for housing is growing in Canada and that it will increase even further by 2024. We foresee an increase of 730,000 households by 2024, for a yearly increase of 240,000 households.
Immigration is expected to play a key role in driving up demand, as the federal government aims to welcome 1.3 million newcomers, boosting the number of households by 555,000 by 2024.
A 25% drop in Canada real estate values is a possibility, says one expert. But have in mind that this is not a fact, this is just an opinon. If this was a fact, the expert would be listing his/her home for sale now and re-purchase it in the future, which is very unlikely.
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The decline in household size over the past few decades should not be underestimated. Households have been shrinking in size, and this is sufficient to increase the number of households by 140,000 (nearly 30,000 annually).
About 30% of Canadians currently live alone.
A relatively small drop in average household size will result in a big boost in housing demand by 2024, RBC said. This trend will create just under 90,000 of the 730,000 new households – a significant boost in housing demand.