Crosstown condos and townhomes . Moody’s said house prices were adjusted in the short term. The city of Bari may bear the brunt. (Barrie) in Bari, Ontario, and (Regina), Lejana, in sand province, will unexpectedly become the most likely places for a short-term adjustment in Canadian house prices.
According to a report by Moody’s research department, according to the Financial Post (Financial Post), “the largest market research will occur in metropolitan areas where house prices have fallen recently, valuations are overvalued and income growth is expected to slow.” Barry and Lizhena bear the brunt.
Moody’s Analytics, a research firm that operates independently of rating agency Moody’s Investor Services (Moody’s Investors Service), forecasts single-family home prices in the coming year based on year-to-date data.
Overall, the report predicts that the Canadian real estate market is fairly stable and that there will be no major short-term adjustments over the next five years. In a market where house prices are rising, the increase is expected to continue to slow and may be offset by higher incomes.
“median household income growth is likely to keep pace with or even exceed house price growth in the coming years, thereby improving housing affordability,” the report said. “
The agency predicts that the rise in interest rates could lead to a rebound in mortgage rates to about 6 per cent from the current five-year rate of 4.4 per cent by 2020. But the report concluded that no “significant” fall in house prices could reduce the risk of mortgage debt worsening during this period.
The downside risk highlighted in the report is that higher lending rates could be combined with tighter lending policies and loan stress tests, which could lead to an across-the-board correction in house prices and a significant decline in sales in areas such as Toronto and Vancouver.
The report also points to some regional differences that have emerged in the Canadian real estate market. Mortgage delinquency rates in Asia, Saudi Arabia and Atlantic provinces, for example, are significantly higher than the national average. The increase in income in British Columbia and Ontario has led to a significant reduction in delinquency rates in these provinces.
Single-family homes in Toronto and Vancouver are still at very high levels of valuation, the report said. However, the situation has improved significantly since the introduction of the first purchase restriction policy since mid-2016.
Moody’s analysis also said that the risk to the basic outlook for the Canadian real estate market is that the borrower stress test launched by banking regulator OSFI this year may be “too strong”. The new stress tests could lead to a serious restructuring of mortgages as potential buyers shift from banks to credit unions and other non-bank mortgage lenders that are not regulated by the OSFI. This will not effectively control house prices and worsen debt.