{"id":7239,"date":"2017-10-26T10:10:31","date_gmt":"2017-10-26T17:10:31","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=7239"},"modified":"2017-10-18T11:18:17","modified_gmt":"2017-10-18T18:18:17","slug":"what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/","title":{"rendered":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?"},"content":{"rendered":"<p style=\"text-align: justify;\">September saw an 0.8% drop in the Teranet-National Bank Composite National House Price Index, the largest monthly decline in seven years. But what does a drop like that mean for the market, heading into 2018?<\/p>\n<p style=\"text-align: justify;\">Published last week, the index indicated that the September decrease was largely thanks to a 2.7% drop in the Toronto market, which has fallen for three consecutive months.<\/p>\n<p style=\"text-align: justify;\">National Bank of Canada Senior Economist Marc Pinsonneault says that the last time the index experienced a similar string of monthly declines was right before the 2008 economic recession.<\/p>\n<p style=\"text-align: justify;\">However, he cautions against drawing a connection between the two events, saying that the Toronto market appears to be balancing out.<\/p>\n<p style=\"text-align: justify;\">\u201cWhen you look at the Toronto index over the last three months, it\u2019s fallen 7.5%,\u201d Pinsonneault tells BuzzBuzzNews. \u201cBut, if you look at the market conditions, the ratio of listings to sales sits at 2.5 months, meaning it would take 2.5 months to sell all the currently listed houses in the area. During the last recession, that number sat at 6.5. So, it\u2019s not a comparable situation.\u201d<\/p>\n<p style=\"text-align: justify;\">Other cities included in the index remained relatively stable in September, with an increase of 1.3% in Vancouver, 0.3% in Calgary and 0.2% in Edmonton, while Victoria was flat.<\/p>\n<p style=\"text-align: justify;\">Despite the drop in the index, both Ontario and BC\u2019s economies are holding strong heading into 2018, with TD Economics predicting that growth will slow to 3% in both provinces by the end of the year.<\/p>\n<p style=\"text-align: justify;\">Pinsonneault says that the drop of the index is largely due to the decline of the Toronto market, as other regions remain balanced. He believes the index will continue to decline in the coming months, but at a slower rate, as the Toronto market continues to balance out.<\/p>\n<p style=\"text-align: justify;\">\u201cWe\u2019re talking about a balanced market in Toronto, which supports the assumption that the price correction which is underway is going to be limited, especially going into the new year,\u201d he says.<\/p>\n<p style=\"text-align: justify;\">Not everyone is so optimistic. Capital Economics Senior Canada Economist David Madani says that the drop is only the beginning of a long-term decrease in prices, especially in the Toronto market.<\/p>\n<p style=\"text-align: justify;\">\u201cI think we\u2019re looking at a very negative housing market in Toronto, something that is only going to get worse moving into the new year,\u201d Madani tells BuzzBuzzNews.<\/p>\n<p style=\"text-align: justify;\">According to Madani, the situation is worsened by a new mortgage stress-testing rule, announced today by the Office of the Superintendent of Financial Institutions.<\/p>\n<p style=\"text-align: justify;\">Effective January 1, uninsured borrowers will have to undergo a stress test at either the Bank of Canada\u2019s five-year average mortgage rate of 4.89 per cent, or two per cent higher than their actual mortgage rate.<\/p>\n<p style=\"text-align: justify;\">Madani says that the new rule could slash housing prices by 15 to 20% in the coming year.<\/p>\n<p style=\"text-align: justify;\">\u201cThese changes are going to have a big negative impact on the housing market, and the purchasing power of home buyers,\u201d Madani says. \u201cThe market was already self correcting, and I think this could lead to a much more pronounced downturn, especially in Vancouver and Toronto. It will reduce the purchasing power of the uninsured homebuyer by 15 to 20%, which will in turn affect housing prices 15 to 20%.\u201d<\/p>\n<p><a href=\"http:\/\/news.buzzbuzzhome.com\/2017\/10\/drop-home-prices.html\" target=\"_blank\" rel=\"noopener\">What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?<\/a> by Sarah Niedoba | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>September saw an 0.8% drop in the Teranet-National Bank Composite National House Price Index, the largest monthly decline in seven years. But what does a drop like that mean for &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/\">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":[8],"tags":[],"class_list":["post-7239","post","type-post","status-publish","format-standard","hentry","category-market-updates"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#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\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"September saw an 0.8% drop in the Teranet-National Bank Composite National House Price Index, the largest monthly decline in seven years. But what does a drop like that mean for &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=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/\"},\"author\":{\"name\":\"Rory Clipsham\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"headline\":\"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?\",\"datePublished\":\"2017-10-26T17:10:31+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/\"},\"wordCount\":555,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"articleSection\":[\"Market Updates\"],\"inLanguage\":\"en-CA\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/\",\"url\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/\",\"name\":\"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#8226; Rory C Real Estate | Oakwyn Realty\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#website\"},\"datePublished\":\"2017-10-26T17:10:31+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/#breadcrumb\"},\"inLanguage\":\"en-CA\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2017\\\/10\\\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?\"}]},{\"@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":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#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\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/","twitter_card":"summary_large_image","twitter_title":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#8226; Rory C Real Estate | Oakwyn Realty","twitter_description":"September saw an 0.8% drop in the Teranet-National Bank Composite National House Price Index, the largest monthly decline in seven years. But what does a drop like that mean for &hellip; [read more]","twitter_creator":"@RoryClipsham","twitter_site":"@RoryClipsham","twitter_misc":{"Written by":"Rory Clipsham","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/#article","isPartOf":{"@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/"},"author":{"name":"Rory Clipsham","@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7"},"headline":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?","datePublished":"2017-10-26T17:10:31+00:00","mainEntityOfPage":{"@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/"},"wordCount":555,"commentCount":0,"publisher":{"@id":"https:\/\/www.roryc.ca\/blog\/#\/schema\/person\/0672b9777e67473b9bd9247df49499c7"},"articleSection":["Market Updates"],"inLanguage":"en-CA","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/","url":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/","name":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term? &#8226; Rory C Real Estate | Oakwyn Realty","isPartOf":{"@id":"https:\/\/www.roryc.ca\/blog\/#website"},"datePublished":"2017-10-26T17:10:31+00:00","breadcrumb":{"@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/#breadcrumb"},"inLanguage":"en-CA","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.roryc.ca\/blog\/2017\/10\/what-does-a-record-drop-in-home-prices-mean-for-canadas-real-estate-market-long-term\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.roryc.ca\/blog\/"},{"@type":"ListItem","position":2,"name":"What Does a Record Drop in Home Prices Mean for Canada\u2019s Real Estate Market Long-Term?"}]},{"@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\/7239","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=7239"}],"version-history":[{"count":1,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts\/7239\/revisions"}],"predecessor-version":[{"id":7240,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/posts\/7239\/revisions\/7240"}],"wp:attachment":[{"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/media?parent=7239"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/categories?post=7239"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.roryc.ca\/blog\/wp-json\/wp\/v2\/tags?post=7239"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}