The number of Canadians expecting home prices to grow is falling very quickly. BMO senior economist Robert Kavcic weighed in on the latest home price growth sentiment. The expectation of growth is beginning to fall nearly as fast as it grew. While it doesn’t mean lower prices (yet), it shows attitudes supporting these price levels are rapidly shifting.
House Price Expectations Are On The Decline
Canadian expectations of home price growth are finally starting to fall. The latest numbers from a Nanos/Bloomberg poll show fewer people now expect prices to rise. While the rate is very high, it’s down sharply from the recent peak. Expectations are falling as fast as they increased.
“Canada’s housing market remains extremely strong, but expectations of price growth look like they may have peaked. Sales and price growth could follow suit,” said Kavcic.
Though he emphasized falling price expectations don’t necessarily mean price declines. “Important: This is not to say that the market is going to decline, but the rate of change may be ready to slow down. Hey, it’s a start,” he added.
Factors That Led To Market Pressures Are Easing
Many of the factors that created a tight market are beginning to reverse, according to the bank. Home sales are still high, but cooled in key markets like Greater Toronto. New inventory is starting to appear, relieving some pressure on prices. Policy is looking a little more hawkish, with rate hikes now coming sooner than expected. Most important, people are thinking about a post-pandemic life — outside of the home.
“There’s still a long way to go until we find a more balanced market, but this shows how effective even small tweaks to monetary policy can be on this front,” he said.
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The vast majority of people aren’t able to grasp what’s in front of them before it happens. To get below 50%, it would probably need to already be a dumpster fire.
Tell this to the Realtor I know that said home prices return 15% per year. A condo in Toronto is literally the greatest investment in the world.
Even companies that solve every problem you’ve ever had cannot compete with the potential of future rents that are perpetually around the corner, but never reached. 😂
A used car salesman is the same way… that’s their job.
Housing isn’t slowing down. Keep dreaming. The market is firing on all cylinders and a lot of money is being made
I mean, in a way, you’re probably right. The housing market isn’t going to slow down per se. What’s going to happen is the whole economy is going to collapse under the weight of the housing market. The housing market slowing down would be a much better alternative.
This is the big issue – how much of the GDP can housing be? We are positioned to be an economy entirely predicated on buying and selling houses to one another and foreign investors. While the world focuses on investing in “essential domestic industries” like vaccine production and micro-chip production (maybe pipelines that don’t cross foreign borders); we count our paper millions and say that all of Canada is now World Class and should be priced accordingly.
Keep growing housing market and when it crashes it will be worst than Greece and Malta etc crisis one has seen.
Any country can’t be strong based on its housing market. And If a common man is struggling to buy a home, forget about any good thing in the rest of the sectors. It’s a sign of third world nations where people struggle for home.
The housing industry is taking Canada to unknown , and yet the
Government don’t know what to do about , leaving it in the hand of of speculators and foreign investors causing panic and scared and
a risk to the Canadian economy all