{"id":8857,"date":"2018-04-25T10:10:16","date_gmt":"2018-04-25T17:10:16","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=8857"},"modified":"2018-04-19T09:53:02","modified_gmt":"2018-04-19T16:53:02","slug":"has-the-canadian-housing-market-finally-adjusted-to-new-mortgage-rules","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2018\/04\/has-the-canadian-housing-market-finally-adjusted-to-new-mortgage-rules\/","title":{"rendered":"Has The Canadian Housing Market Finally Adjusted to New Mortgage Rules?"},"content":{"rendered":"<p style=\"text-align: justify;\">A new mortgage stress test that came into effect on January 1 sent home sales across the country plummeting. But now that the first quarter of 2018 is behind us, is there relief in sight for the Canadian housing market?<\/p>\n<p style=\"text-align: justify;\">Some signs point to yes \u2014 a flattening of prices and a small uptick in sales could mean that the worst effects of the new mortgage rules are behind the market.<\/p>\n<p style=\"text-align: justify;\">To take a closer look at the issue, BuzzBuzzNews has rounded up the latest industry commentary on where the market is headed next.<\/p>\n<p style=\"text-align: justify;\"><strong>The GTA could be leveling out<\/strong><\/p>\n<p style=\"text-align: justify;\">While GTA home sales numbers are still not what they could be \u2014 they only increased by 2.1% month-over-month in March \u2014 RBC senior economist Robert Hogue says that the increase is a sign that the market is on its way to balancing out.<\/p>\n<p style=\"text-align: justify;\">\u201cOn the surface, [home sale numbers] continued to point to significant weakness in activity on a year-over-year basis in [the GTA],\u201d he writes. \u201c[However,] in the GTA, the sharp year-over-year drop in home resales in March was only modestly more pronounced than the 35% decline recorded in February.\u201d<\/p>\n<p style=\"text-align: justify;\">Hogue does caution that, even with a slight month-over-month uptick in sales, it\u2019s likely still too soon to know to what extent the market will recover from the effects of the stress test in coming months.<\/p>\n<p style=\"text-align: justify;\">\u201cIt will take a little longer to ascertain how much of the impact is temporary and how much is permanent,\u201d writes Hogue.<\/p>\n<p style=\"text-align: justify;\"><strong>Prices are flattening<\/strong><\/p>\n<p style=\"text-align: justify;\">Prices are also showing signs of balancing out. The Teranet-National Bank Composite National Home Price Index was flat in March, following a 1.9% decline in February.<\/p>\n<p style=\"text-align: justify;\">According to National Bank senior economist Marc Pinsonneault, the Toronto and Vancouver markets disportionately affect the index, and the flat reading in March reflects the fact that both have begun to level out.<\/p>\n<p style=\"text-align: justify;\">\u201cThe decline [in March] was the most obvious in Toronto [which has dropped 7.3% since July],\u201d he writes. \u201cThis drop was likely triggered by Ontario\u2019s implementation of the 15 per cent [foreign buyer tax] followed by stricter rules for qualification for a mortgage and a rise in mortgage rates.\u201d<\/p>\n<p style=\"text-align: justify;\">Pinsonneault writes that these changes have balanced out the Toronto market, while the Vancouver market is likely to follow suit, after an expansion of its foreign buyer tax was announced last month. The result? National home prices will remain relatively even in the coming months.<\/p>\n<p style=\"text-align: justify;\">\u201cWith the two most important Canadian markets now in balanced territory or nearing it, a soft landing is the most likely outcome for the Canadian residential market,\u201d he writes.<\/p>\n<p style=\"text-align: justify;\"><strong>Sales are inching upwards<\/strong><\/p>\n<p style=\"text-align: justify;\">After two consecutive sales drops in January and February, home sales inched up 1.3% in March.<\/p>\n<p style=\"text-align: justify;\">That number was supported by strong activity in markets like Montreal and Ottawa, where sales were up 5.1% and 22.1%, respectively. This offset a 8.6% drop in Vancouver home sales, and a small 2.1% increase in the GTA.<\/p>\n<p style=\"text-align: justify;\">\u201cCanadian housing markets are likely to remain under-pressure from the recent [new mortgage rules], higher mortgage rates, and in some cases provincial regulation,\u201d writes TD senior economist Michael Dolega, in a recent note. \u201cHowever, lower-priced markets where affordability is good should generally outperform in the current environment.\u201d<\/p>\n<p><a href=\"http:\/\/news.buzzbuzzhome.com\/2018\/04\/canadian-housing-market-finally-adjusted-new-mortgage-rules-industry-experts-give-take.html\" target=\"_blank\" rel=\"noopener\">Has The Canadian Housing Market Finally Adjusted to New Mortgage Rules?<\/a> by Sarah Niedoba | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A new mortgage stress test that came into effect on January 1 sent home sales across the country plummeting. But now that the first quarter of 2018 is behind us, &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2018\/04\/has-the-canadian-housing-market-finally-adjusted-to-new-mortgage-rules\/\">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-8857","post","type-post","status-publish","format-standard","hentry","category-market-updates"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Has The Canadian Housing Market Finally Adjusted to New Mortgage Rules? &#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\/2018\/04\/has-the-canadian-housing-market-finally-adjusted-to-new-mortgage-rules\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Has The Canadian Housing Market Finally Adjusted to New Mortgage Rules? &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"A new mortgage stress test that came into effect on January 1 sent home sales across the country plummeting. 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