OTTAWA — Canada's housing market "remains a notable out-performer" in comparison to other countries, where renewed doubts about the strength of the global economy are weakening an already fragile real-estate scene, says a report released Tuesday.
The Bank of Nova Scotia said in an assessment of the global housing market that high unemployment, concerns over the financial health of some European governments, signs the global economic recovery is slowing down and recent stock-market volatility are burdening residential real-estate markets around the world.
For many people, saving money and repaying debt have become bigger priorities than making major purchases, such as homes, the report said.
"We expect global housing demand to remain moribund until the global economic recovery gets back on a firmer footing and some financial market stability returns," said Adrienne Warren, senior economist with Scotia Economics.
Canada is one of just three of the nine developed countries assessed that saw year-to-year price growth, adjusted for inflation, in its housing market in this year's second quarter. There was five per cent price growth, on average, in the April-to-June period.
"Ultra-low interest rates will continue to support affordability in the face of record high prices," Warren said of Canada. "Nonetheless, heightened economic uncertainty, combined with recent signs of a loss of momentum in Canada's jobs market, could keep some potential buyers on the sidelines for the time being.
"On balance, we anticipate a modest slowdown in the volume of sales transactions heading into year end, alongside relatively flat prices."