Strengthened by the white hot housing market and global demand for goods, economic growth of B.C. led major provinces last year. Do not expect that speed to continue in 2022,
The bank predicts that the West Coast economy will grow by 4.2 percent this year – down from 2021 which has grown by 5.9 percent. Last year B.C. registered the highest rate of economic growth among the four major provinces, and the second in Canada was Prince Edward Island.
Economists Robert Hogue and Carrie Freestone said in a report on Tuesday that B.C. will fall “in the middle of the pack” this year, along with Ontario (+4,1 percent) and Quebec (+ 3,6%).
Instead, Saskatchewan (+ 6%), Alberta (+ 5.7%) and Manitoba (+ 4.8%) will take the lead as the housing market recovers in B.C. and Ontario.
“We expect higher interest rates to further the limited real estate transaction in the future and increase the cooling effect in some regions. Rapidly declining purchases – especially in the more expensive Canadian markets – will make it much harder to keep up with the latest real estate prices, “he said.
“In fact, we believe that domestic prices have reached a high level in many markets in Ontario and British Columbia. Doing so gradually will reduce the huge contribution the housing industry makes to economic growth during the violence. ”
The average residential value of the Multiple Listing Service (MLS) by B.C. was $ 1.065 million in April, according to the latest data from B.C. Housing Association. That increased by 12.9 percent from $ 943,765 in the same month last year.
Accommodation in MLS B.C. They are expected to drop to 97,240 units this year, down 22 percent from the 2021 high record, according to the latest BCREA forecast released on May 31.
And sales of MLS residences are projected to drop by 12.4 percent to 85,150 units the following year.
Meanwhile, the RBC report predicts the province with the lowest inflation rate in Canada when the 2022 figures are consolidated: 5.4 percent compared to the national average of 5.8 percent.
Inflation remains at 6.7 percent from April – the latest month when Statistics Canada released data – on the West Coast.
Hogue and Freestone “expect inflation to decline steadily across Canada later this year as stable electricity prices, higher interest rates reduce consumer demand and a cooler housing market eases the pressure on shelter costs.”
Their forecast also predicts that investment in the services sector, such as the construction of major LNG projects, will continue to boost the province’s economy.
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