Scarce housing supply will play a significant role
Essentials like housing and groceries are likely to become more expensive in 2021, while gas and discretionary experiences like air travel might fall in value, according to various observers.
The latest forecast by the Canadian Real Estate Association pegged national average price growth at 9.1% this year, pushing the average home price to around $620,400.
Tight inventory will play a major role in stronger price growth, especially in Ontario and Quebec.
“[Even] provinces like Alberta and Saskatchewan are anticipated to see higher price tags after several years of depreciation,” Narcity said in its recent analysis.
British Columbia will enjoy a similarly robust housing market, with Central 1 Credit Union forecasting that the “exceptionally strong” performance last year will push average prices up by 5.6% in 2021 and 4% in 2022.
Data from the 2021 edition of the Food Price Report indicated that average food prices are expected to increase by 3% to 5% this year. This will push the annual grocery expenses of a four-person household to an average of $13,907.
Retail costs are similarly expected to rise this year, although the drastic drop in long-distance travel will continue pushing down gas costs.
“The cost of travel experiences is expected to fluctuate depending on how the pandemic progresses, with super-low prices set to stick around while COVID-19 remains an issue,” Narcity said. “However, as more and more people get vaccinated and demand for travel resurges, costs could rise again as quickly as they fell.”
