Yonge City Square Residences.67% of home buyers may go bankrupt! The Central Bank of Canada has raised interest rates seven times this year to fight inflation. In the process, banks raised interest rates from 0.25% to 4.25%.Please Visit: Yonge City Square Residences to Get Your VVIP Registration Today!
The cost of owning a house in Canada requires 67.3% of income to repay debt, the highest level since 1981. In other words, nearly 60% of home lenders will be at risk of bankruptcy.
Canada has been suffering from inflationary pressures recently, and interest rates continue to rise. This makes the Canadian dollar very strong.
Recently, the Royal Bank of Canada (RBC) issued the most serious real estate bear market warning: Canada’s house price correction is the deepest in half a century!
RBC explained to investors that the Canadian housing market is adjusting. Before that, RBC had already lowered its housing market forecast once.
However, RBC found that all major property markets reported further declines, and they saw a widening range of housing adjustments, which could be the most serious in half a century.
Canada’s main real estate market reported sales last month, and the figures are not satisfactory.
Both Toronto and Vancouver have reported sharp declines in sales and prices, with Toronto homes down more than 500000 in the past six months, while other large Canadian markets are also showing signs of decline.
Robert Hogue, assistant chief economist at RBC, said: “the housing adjustment is now spreading across Canada.”
“in Toronto and Vancouver, the rapid decline in sales activity is becoming one of the worst declines in the past half century.”
RBC said higher interest rates were the catalyst for the housing correction. When buyers realized that house prices could not rise forever, the red-hot property market was forced to cool down.
After experiencing a rapid rise in house prices, buyers are unlikely to react quickly to falling prices.
Markets with smaller price increases are more likely to adjust less, but only likely, the bank said.