Citing a “greater-than-expected resilience” in the housing market, TD Economics has updated their earlier forecast from July.
TD has revised both average price and sales figures upwards and anticipates that Alberta’s housing market will be a “top performer” over the next few years.
Alberta home prices are now expected to post a 5.5% year-over-year increase in 2013 compared to their previous estimate of 3.8%.
Average prices in the province are forecast to increase another 3.5% in 2014 and 1.8% in 2015.
The largest adjustment was to their sales forecast. Back in the summer, TD had called for only a 1.6% y/y increase. That figure has now been boosted to 10%. Sales growth is predicted to slow to 3% in 2014 and 1.1% in 2015.
Regarding the surge in resale activity, TD writes:
On the surface, it may appear as though the housing market is picking up where it left off before the last round of mortgage regulation adjustments by the federal government in July 2012.
However, we believe that the big impetus behind the current spike in activity is related to home buyers entering the market to beat out the increase in longer-term mortgage rates, which have been put in place over the past 4-5 months.
We expect that this uptick in activity should subside by the end of 2013 and early 2014, as markets adjust to higher borrowing costs.
You can download the entire provincial forecast here