{"id":4031,"date":"2016-11-18T15:15:49","date_gmt":"2016-11-18T23:15:49","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=4031"},"modified":"2016-11-18T08:43:26","modified_gmt":"2016-11-18T16:43:26","slug":"heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/","title":{"rendered":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios"},"content":{"rendered":"<p style=\"text-align: justify;\">What would happen to Canadian home prices if interest rates spiked? How about in the event of a high-magnitude earthquake that wreaks havoc in one of the country\u2019s biggest cities?<\/p>\n<p style=\"text-align: justify;\">These are two of several hypothetical scenarios the Canada Mortgage and Housing Corporation, Canada\u2019s national housing agency and a mortgage loan insurance provider, explores in its 2016 stress test.<\/p>\n<p style=\"text-align: justify;\">\u201cStress testing involves searching out extreme scenarios that have a very remote chance of happening and planning for them,\u201d says Romy Bowers, CMHC\u2019s chief risk officer.<\/p>\n<p style=\"text-align: justify;\">A surge in interest rates resulting in higher borrowing costs and the failure of at least one Canadian financial institution could mow down home prices by 30%, CMHC estimates in results published today.<\/p>\n<p style=\"text-align: justify;\">The Crown corporation notes that none of the test results are predictions or forecasts. All apply to the 2017-2021 period, for which base-case price growth is pegged at 9% barring these stress-testing scenarios.<\/p>\n<p style=\"text-align: justify;\">In the case of a richter-scale-rocking quake striking a major Canadian urban centre, Canadian home prices could fall 0.6% in the worst case considered.<\/p>\n<p style=\"text-align: justify;\">A handful of Canadian cities have considerable sway on national home prices. For instance, the countrywide average hit $481,994 last month, according to the Canadian Real Estate Association, but if Greater Vancouver and Greater Toronto are excluded, it was $361,012.<\/p>\n<p style=\"text-align: justify;\">Other scenarios explored include severe economic depression lasting several years and an oil price shock that sees oil prices bottom out at $20 (in US dollars) per barrel next year and hover between $20 and $30 until 2022.<\/p>\n<p style=\"text-align: justify;\">In the economic depression scenario, prices drop 25 per cent, while the oil crisis clips prices by 7.8%.<\/p>\n<p style=\"text-align: justify;\">CMHC\u2019s capital holdings would allow the agency to withstand even \u201cthe most extreme scenarios,\u201d it says.<\/p>\n<p style=\"text-align: justify;\">\u201cRigorous stress testing is an essential part of our risk management program and allows CMHC to evaluate its capital levels against these scenarios,\u201d Bowers adds.<\/p>\n<p><a href=\"http:\/\/news.buzzbuzzhome.com\/2016\/11\/canadian-home-prices-plummet-stress-test-scenarios.html\" target=\"_blank\">Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios<\/a> by Josh Sherman | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>What would happen to Canadian home prices if interest rates spiked? How about in the event of a high-magnitude earthquake that wreaks havoc in one of the country\u2019s biggest cities? &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/\">read more<\/a>]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-4031","post","type-post","status-publish","format-standard","hentry","category-real-estate"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"What would happen to Canadian home prices if interest rates spiked? How about in the event of a high-magnitude earthquake that wreaks havoc in one of the country\u2019s biggest cities? &hellip; [read more]\" \/>\n<meta name=\"twitter:creator\" content=\"@RoryClipsham\" \/>\n<meta name=\"twitter:site\" content=\"@RoryClipsham\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Rory Clipsham\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/\"},\"author\":{\"name\":\"Rory Clipsham\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"headline\":\"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios\",\"datePublished\":\"2016-11-18T23:15:49+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/\"},\"wordCount\":336,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"articleSection\":[\"Real Estate\"],\"inLanguage\":\"en-CA\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/\",\"url\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/\",\"name\":\"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#website\"},\"datePublished\":\"2016-11-18T23:15:49+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/#breadcrumb\"},\"inLanguage\":\"en-CA\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2016\\\/11\\\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#website\",\"url\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/\",\"name\":\"Rory C Real Estate | Oakwyn Realty\",\"description\":\"Rory C Real Estate Updates | Home Selling &amp; Buying\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-CA\"},{\"@type\":[\"Person\",\"Organization\"],\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\",\"name\":\"Rory Clipsham\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-CA\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/wp-content\\\/uploads\\\/2019\\\/10\\\/RoryC-white-w-tagline.jpg\",\"url\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/wp-content\\\/uploads\\\/2019\\\/10\\\/RoryC-white-w-tagline.jpg\",\"contentUrl\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/wp-content\\\/uploads\\\/2019\\\/10\\\/RoryC-white-w-tagline.jpg\",\"width\":504,\"height\":504,\"caption\":\"Rory Clipsham\"},\"logo\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/wp-content\\\/uploads\\\/2019\\\/10\\\/RoryC-white-w-tagline.jpg\"},\"sameAs\":[\"http:\\\/\\\/www.roryc.ca\\\/\",\"https:\\\/\\\/www.facebook.com\\\/pg\\\/BurnabyandCoquitlamHomes\\\/about\\\/?ref=page_internal\",\"https:\\\/\\\/www.instagram.com\\\/roryclipshamhomes\\\/\",\"https:\\\/\\\/x.com\\\/RoryClipsham\"]}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/","twitter_card":"summary_large_image","twitter_title":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty","twitter_description":"What would happen to Canadian home prices if interest rates spiked? How about in the event of a high-magnitude earthquake that wreaks havoc in one of the country\u2019s biggest cities? &hellip; [read more]","twitter_creator":"@RoryClipsham","twitter_site":"@RoryClipsham","twitter_misc":{"Written by":"Rory Clipsham","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/#article","isPartOf":{"@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/"},"author":{"name":"Rory Clipsham","@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7"},"headline":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios","datePublished":"2016-11-18T23:15:49+00:00","mainEntityOfPage":{"@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/"},"wordCount":336,"commentCount":0,"publisher":{"@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7"},"articleSection":["Real Estate"],"inLanguage":"en-CA","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/","url":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/","name":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios &#8226; Rory C Real Estate | Oakwyn Realty","isPartOf":{"@id":"https:\/\/www.roryc.ca\/blog\/#website"},"datePublished":"2016-11-18T23:15:49+00:00","breadcrumb":{"@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/#breadcrumb"},"inLanguage":"en-CA","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.roryc.ca\/blog\/2016\/11\/heres-how-much-canadian-home-prices-could-plummet-in-5-stress-test-scenarios\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.roryc.ca\/blog\/"},{"@type":"ListItem","position":2,"name":"Here\u2019s How Much Canadian Home Prices Could Plummet in 5 Stress Test Scenarios"}]},{"@type":"WebSite","@id":"https:\/\/www.roryc.ca\/blog\/#website","url":"https:\/\/www.roryc.ca\/blog\/","name":"Rory C Real Estate | Oakwyn Realty","description":"Rory C Real Estate Updates | Home Selling &amp; Buying","publisher":{"@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.roryc.ca\/blog\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-CA"},{"@type":["Person","Organization"],"@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7","name":"Rory Clipsham","image":{"@type":"ImageObject","inLanguage":"en-CA","@id":"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/10\/RoryC-white-w-tagline.jpg","url":"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/10\/RoryC-white-w-tagline.jpg","contentUrl":"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/10\/RoryC-white-w-tagline.jpg","width":504,"height":504,"caption":"Rory Clipsham"},"logo":{"@id":"https:\/\/www.roryc.ca\/blog\/wp-content\/uploads\/2019\/10\/RoryC-white-w-tagline.jpg"},"sameAs":["http:\/\/www.roryc.ca\/","https:\/\/www.facebook.com\/pg\/BurnabyandCoquitlamHomes\/about\/?ref=page_internal","https:\/\/www.instagram.com\/roryclipshamhomes\/","https:\/\/x.com\/RoryClipsham"]}]}},"_links":{"self":[{"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts\/4031","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/comments?post=4031"}],"version-history":[{"count":2,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts\/4031\/revisions"}],"predecessor-version":[{"id":4033,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts\/4031\/revisions\/4033"}],"wp:attachment":[{"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/media?parent=4031"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/categories?post=4031"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/tags?post=4031"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}