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Commercial projects will help Canadian builders cope with inflated residential market

Posted: January 14, 2014



Canada’s housing market has been performing well in recent times, with sales and home values increasing significantly. However, some fear that a small housing bubble could be forming across the country, which could result in a quick drop in prices and activity in the coming year.

According to The Canadian Press, officials at Fitch Ratings recently announced that they believe the value of homes in Canada is inflated. Overall, Fitch indicated that the prices of homes are overvalued by 21 percent nationally, and that number reaches 26 percent in some regions. Although the organization does not expect an abrupt drop in rates, it does believe the prices of homes will decline slowly over the next five years as the market adjusts.

That could result in subdued activity for future residential construction starts, which could be challenging for some builders to address. However, BTY Group recently released a forecast that indicated commercial work across Canada could be set to rise, possibly providing contractors with much needed work as the housing market cools.

In fact, demand for new energy, infrastructure and other commercial projects will be so high that BTY Group expects there to be a spike in employment opportunities in the future.



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