GTA’s strong economy affects the housing market

The greater Toronto Areas strong economic growth is having significant effects on the hot housing market but Bank of Canada governor Stephen Poloz is more concerned about the debt ratio of people.
When asked about government’s intervention in the real estate market, he responded that it is a very complex question.
However, he went on to warn on the impacts speculators have on the housing market and the economy.
Although other real estate markers are growing, in the case of Toronto, rising home prices poses as a risk for the city.
In his opinion about whether it is late for the government to step in, he explained that is a crucial matter as the GTA economy is growing at a rapid pace while job creation is also outpacing the rate of growth in other parts of the country.
Evidently, Ontario increased on its new jobs in January according to Statistics Canada with Toronto’s GDP expected to rise by 2.6% this year which is only outpaced by Vancouver.
The vibrant economic growth is boosting the demand for homes while supply is not keeping up with the pace.
Notwithstanding the fact that the basics of economic and job growth are strong, it is very challenging to understand the growth the city has seen I addition to a great degree of unique dynamics involved referring to market spectators.
Presently, it is quite difficult for economists to determine the market dynamics as they watch how things play out in the market.
With people homes just for the gains they will get in case of further increases, that according to Poloz is not demand fundamental.
It also very risky for people to engage in flipping homes to make money in a market that fluctuates at extreme levels.
Nevertheless, the main concern of the bank is the debt that Canadians are taking on and its more worrying thinking about how people will get to repay their debts if interest rates are to be changed.