Pressure is intense on governments and regulators to address affordability issues. Housing policy wildcardĪnother development that could alter the market’s direction this year is housing policy changes. Higher interest rates will further erode already-poor housing affordability in Canada’s major markets. This phenomenon should reverse by mid-year and work to cool demand. Our view is the anticipation of higher rates is already impacting the market: currently bringing some activity forward as buyers hurry to lock-in lower rates. We expect the Bank of Canada to raise interest rates materially starting this spring-taking its overnight rate up 150 basis points in less than a year and a half. However, we believe interest rate increases will alter the market’s course later this year. Intense buyer competition should keep prices on a steep upward trajectory in the near term. We don’t expect that heat to dissipate quickly. That may change if demand-supply conditions stay tight in the coming months.Įxpected interest rate hikes to alter the market’s courseĬanada’s housing market therefore enters 2022 in broadly the same way that it did in 2021: under the scorching heat of supercharged demand running against historically low inventories. Properties in these regions generally continue to appreciate at modest rates. John’s have yet to experience a high degree of frenzy. During the pandemic we’ve seen rapid price escalation as demand surged in smaller markets, often outpacing appreciation in larger centres like Vancouver, Toronto and Montreal by wide margins-though Toronto prices have accelerated significantly (up 12%) over the past three months. ![]() Chilliwack, Bancroft, Brantford and North Bay) even registering greater than 40% y/y gain. ![]() Rates of increase exceed 30% in large parts of British Columbia, Ontario and Atlantic Canada, with some markets (e.g.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |