House prices have been climbing for years in Canada’s hottest housing markets. But with OSFI introducing new mortgage stress test rules and the central bank’s rate hike in January, many Canadians are wondering if house prices will continue to rise this year.
In Toronto and Vancouver, Canada’s largest and hottest housing markets, many industry experts are forecasting for growth to continue this year as strong demand, particularly in the condo market, is met with limited supply.
Although the Greater Toronto Area (GTA) saw a 17% year-over-year increase in new listings in January, total new listings were the second lowest for January in the past 10 years. Meanwhile, new listings in Metro Vancouver dropped by 8.3% in January compared to the same month last year.
Also read: Demand for housing exceeds supply in Toronto and Vancouver
“When you have weak supply responses, as you do in these markets, prices have nowhere to go but up,” said Aled ab lorweth, deputy chief economist for Canada Mortgage Housing Corporation (CMHC).
