Canada's housing market is still hot compared to the rest of the world

Canada's resale housing market is slowing, but still outperforming markets in much of the developed world, the Bank of Nova Scotia says.

Indeed, senior economist Adrienne Warren said in a new report today, Canada, France and Switzerland stood alone among nine markets measured in recording annual price gains, based on second-quarter data.

“In the majority of the major markets we track in North America , Europe and Australasia, inflation-adjusted home prices declined on a year-over-year basis in the second quarter of 2011,” Ms. Warren said.“While Canada’s hot housing market also has begun to cool, it remains a notable outperformer.”

Scotiabank expects housing demand around around the world to remain "moribund" until the recovery picks up. And, while Canada's real estate market is notable for its "resilience and longevity," a stalled jobs market could still keep some buyers out of the market.

"On balance, we anticipate a modest slowdown in the volume of sales transactions heading into year-end, alongside relatively flat prices," Ms. Warren said.

Canadian house prices, on average and adjusted for inflation, climbed 5 per cent in the second quarter, according to Scotiabank. That compares to 5 per cent in France and 4 per cent in Switzerland. Prices fell 6 per cent in the United States, 6 per cent in Britain, 10 per cent in Spain, 14 per cent in Ireland, 1 per cent in Sweden, and 6 per cent in Australia.

Source: Michael Babad, Globe and Mail