Provincial Outlook: Resurgent Housing Market Reshuffles Provincial Growth Rankings … for Now

We’ve revised growth rates materially higher for Ontario and BC following torrid early‑2023 housing market rebounds. However, we still think Canada’s oil‑producing regions face the best economic prospects in 2023–24.

Along with acute labour shortages, skyrocketing population growth has supported the economic expansion in all provinces so far this year.

Yet while these developments help the 2023 growth arithmetic, they don’t rule out a downturn altogether—they just delay it until 2024. Falling home sales in Toronto and Vancouver immediately after the Bank of Canada resumed interest rate hikes suggest momentum is already slowing.

Monetary policy works with a lag, and all regions should increasingly feel the dampening impacts of sharply higher interest rates in the coming months. As we approach 2024, more housing‑oriented provincial economies should see the more significant slowdowns we’ve long been expecting.