Wednesday, October 19, 2005
The Economic Impact of Home Sales: a Canadian Study.
A new study by Clayton Research Associates finds that the purchase and sale of homes through the MLS system generates an average of CAD $19,800 per transaction in additional consumer spending. Clayton Research is a firm of urban and real estate economists providing strategic information, analysis and advice to private and public sector clients across Canada. The firm specializes in real estate market analysis, land use planning issues, consumer spending and borrowing research, and building products demand. The study, which was commissioned by the Canadian Real Estate Association (CREA) found that the $19,800 increase generated by each single real estate deal includes:
- fees paid to professionals such as realtors, lawyers, appraisers and surveyors;
- taxes and fees, including registration fees, paid to governments;
- purchase of new appliances, furnishings as well as renovations.
During the span of time scrutinized by Clayton, which ran through the period between January, 2000 through November, 2002 an average of 381,800 homes changed hands annually.
The study found that when Canadians move, they typically purchase new appliances or furnishings as well as renovate. As a result, resale housing transactions generate CAD $7.5 billion per year in additional consumer spending and help create more than 101,600 jobs attributable to moving. This is, unquestionably, a significant contribution to the Canadian economy. More specifically, consumers spend their money as follows (all figures are in CAD):
- $ 490 for moving costs.
- $ 1,315 in general household purchases.
- $ 3,385 in new furniture and appliances.
- $ 3,550 in renovations.
- $ 9,485 in professional services.
Clayton Research Associates maintains a website at http://www.clayton-research.com .
Real Estate Chronicle.