The Canadian residential marketplace has remained strong in the face of perilous real estate markets in the United States. Canadians have continued to buy, and renovate their homes at a record pace.
Statistics Canada reported that residential housing construction projects jumped 8.5% to $79.8 billion dollars from the 2005 numbers. This is yet another sign of continuing growth in the Canadian Real Estate market place. All this, despite the slowing Real Estate market, in the U.S..
Some fear that the U.S. slow down will impact the Canadian market place and consumers will tighten the purse strings and slow spending. The situation differs between the two neighboring nations because Canadians have yet to fully embraced the non-conventional mortgage market. Products offer 40 year amortizations and no down payment have not been used as frequently in Canada as it has in the United States.
Now this information has caused new housing starts will begin to slow, as eventually will sales activity in the residential resale market, the renovation cycle is likely to last longer. The renovation cycle tends to last longer than a sales cycle. Improvement to your home is of greater value to current homeowners. Not only do the improvements improve the value of the home they improve the functionality and usability of your space.
This causes us to believe that home renovations will continue to outpace the residential housing market. Statscan continues to support this belief as they reported that by stating that Canadian renovation spending increased 8.7% to $32 Billion in 2006. As the housing market slows then renovation and reinvestment in currently owned properties should increase.
Even locally we can see evidence of a slowing residential resale market. Yet our local construction supply stores seem to be doing a booming business. Residential resale properties and new builds will continue to move forward in Canada but at a slower pace. Home renovations will continue to outpace Real Estate sales for the near future.
This creates an alternative to buying up. Individuals can reinvest in their current properties, therefore limiting any depreciation in the home and adding increased value to there home.
