Time for your cheat sheet on this week’s top stories.
Canadian Real Estate
Canadian Real Estate Prices Have Officially Crashed In 18 Markets
Canadian real estate is spiraling lower as 18 markets enter a technical “crash.” Sharp corrections were in Oakville-Milton (-$398,700), Mississauga (-$286,000), and Cambridge (-$249,600).
No need to panic—even with this pullback, prices are still up over the past two years. More markets are expected to join the 18 technical crashes in the coming months.
Canadian Housing Affordability Hits Unsustainable Level: BoC Index
The Bank of Canada’s Housing Affordability Index shows unsustainable pricing. An average homebuyer needs 48.8% of disposable income to buy a home in Q3 2022. This was an increase of 11.1 points from last year, and is the highest share since the early 80s and 90s. Both previous stints didn’t last long, and came to an end with a sharp price decline.
Canadian Real Estate Buyers Opt For Fixed Terms After Variable Shock
Canada’s love affair with variable rate mortgage credit has faded as quickly as it came. Only 29.7% of uninsured mortgage debt in October had variable interest, compared to 60.1% at the peak in January 2022. Borrowers want the predictability of fixed rates after payment shock horror stories.
Canadian Real Estate Prices To See Double-Digit Drop, Delinquencies Climb: Fitch Ratings
Credit giant Fitch Ratings is warning investors about Canadian real estate next year. The firm has forecast prices will fall sharply, and mortgage delinquencies will climb. Rising rates are compounding frothy growth over the past 30 years. The firm warns a deeper recession would mean even bigger price declines.
People in Canada have adopted Trudeau’s attitude Debt doesn’t matter. Only problem is unlike Trudeau people don’t have money printing machines
The Bank of Canada has a fiduciary duty to support house prices. Rates NEED to be dropped to 0% to help prices.
https://veerealtors.com accesses articles like these initially from Residential Realty Today email newsletter. This is a valuable resources (this is not a commercial but recognition of a useful resource). Having some insight into Canada’s market helps us better represent clients in the US. Similarities and differences become points of comparative analysis and discussion.