BCREA Perspective of Vancouver Real Estate

From Cam’s Desk

Our good friend Cameron Muir, Chief Economist at the British Columbia Real Estate Association has this to say about the latest Bank of Canada Interest Rate Decision’s possible impact on Vancouver real estate.

On Hold Highlights

  • Bank of Canada opted to hold its target overnight rate at 1 per cent.
  • global economic outlook is deteriorating, largely due to an expected deep and prolonged recession in Europe
  • the Bank expects the Euro-crisis to be contained
  • will impact the Canadian economy this year
  • Bank is forecasting GDP growth of just 2 per cent in 2012
  • the Bank anticipates that both total and core inflation will moderate this year before rising to 2 per cent by the third quarter of 2013.

BCREA Outlook

  • the economy is largely in-line with the Bank of Canada -indeed our forecast for economic growth is almost identical
  • Canadian economy is likely to face a number of head winds in 2012, both externally from the Euro-debt saga and an uncertain US economy, and internally as traditional sources of growth begin to fade
  • it is difficult to see where economic growth will come from in 2012

Expected

  • Canadian consumption slows
  • Governments begin to address fiscal gaps
  • Residential construction moderates
  • leaves private business investment to drive the economy however,..
  • murky demand outlook, it is far from certain that businesses will be in the mood to take on significant new projects

Upside to Downside

  • unlikely that the Bank of Canada will move on interest rates in 2012
  • long-term rates will remain at historically low levels until confidence is restored in the sovereign debt of Europe

Courtesy the British Columbia Real Estate Association “Copyright British Columbia Real Estate Association. Reprinted with permission.” Image Courtesy Bank of Canada

About Larry Yatkowsky

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*Disclaimer: Statistics Courtesy REBGV. While believed to be accurate they are not guaranteed.
**Numbers provided may vary as they are dynamically posted by the REBGV.

Reader Comments:

Boombust Says:
January 17th, 2012 at 6:47 pm

Who cares?

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