According to data released by Statistics Canada, Canada’s Gross Domestic Product (GDP) increased by 0.8%. The annual total GDP of Canada rose by 1.2%. The outstanding performance of the Canadian economy in 2015 can be attributed in part to the real estate market. Investors looking to immigrate to Canada will find that the real estate market contributed 7.4 billion to the GDP, accounting for about half of Canada’s 2015 economic growth.
GDP measures the economic trends of a country over a specific period. It is a simple way to determine whether a country's economic environment is healthy. When GDP is positive, it indicates that the economy of that country is growing. When it is negative, it means the economy is contracting.
The real estate market’s GDP is steadily increasing every month; however, other industries, such as manufacturing, oil, and gas, often experience fluctuations. Agriculture follows the real estate market, contributing 3 billion to the GDP, while the finance and insurance sector ranks third, contributing only 2 billion. Manufacturing is mostly related to other industries and experienced a negative growth of 2 billion last year.
It is evident that the growth of the economy in 2015 relied heavily on the real estate sector, highlighting the importance of the real estate market in Canada.
"The real estate sector's significant share is quite concerning," stated TD Bank economist Brian DePratto in a statement in January. "This underscores the importance of real estate to Canada’s growth and also highlights the risks that the real estate market poses to the Canadian economy."
Last year, the Bank of Canada indicated that Canadian housing prices were overvalued by 30%. "Rising Canadian housing prices will eventually cool down," the rating agency Fitch believes.
