{"id":9119,"date":"2018-05-22T10:10:37","date_gmt":"2018-05-22T17:10:37","guid":{"rendered":"http:\/\/www.roryc.ca\/blog\/?p=9119"},"modified":"2018-05-22T10:24:23","modified_gmt":"2018-05-22T17:24:23","slug":"aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018","status":"publish","type":"post","link":"https:\/\/www.roryc.ca\/blog\/2018\/05\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\/","title":{"rendered":"Aggregate Home Prices will Increase by Only 1.8% Nationwide in 2018"},"content":{"rendered":"<p style=\"text-align: justify;\">As Canadian year-over-year home sales and prices have continued to drop, many economists have predicted that activity will begin to heat up again in the second half of the year. But according to one economist, prices aren\u2019t going anywhere fast.<\/p>\n<p style=\"text-align: justify;\">\u201cRecent policy actions and rising interest rates will take the wind out of home prices\u2019 sail this year in Canada,\u201d writes RBC senior economist Robert Hogue, in a recent note.<\/p>\n<p style=\"text-align: justify;\">Hogue predicts that aggregate prices will increase by only 1.8% nationwide in 2018, after surging 10% on average in the past two years. The cause? A series of policy changes and a rising interest rate environment, which are putting a downward pressure on home prices.<\/p>\n<p style=\"text-align: justify;\">\u201cOntario\u2019s Fair Housing Plan triggered the cooling process in April 2017 and three interest rate hikes since July reduced the market\u2019s heat even more,\u201d he writes. Add to that the new stress test introduced on January 1, and you\u2019ve got a recipe for a cooler market.<\/p>\n<p style=\"text-align: justify;\">\u201cThe new stress test will reduce the home purchasing power of many qualifying borrowers,\u201d writes Hogue. \u201cThis will fuel demand for lower-priced units at the expense of more expensive options.\u201d<\/p>\n<p style=\"text-align: justify;\">What\u2019s more, higher interest rates will mean that many homeowners will be facing higher mortgage rates in the very near future.<\/p>\n<p style=\"text-align: justify;\">\u201cFor the first time since 2008, fixed-rate mortgage holders will face an increase in mortgage rates when renewing a maturing five-year term,\u201d writes Hogue. \u201cThis will throw some sand in the gears of move-up buying activity in certain markets.\u201d<\/p>\n<p style=\"text-align: justify;\">Hogue forecasts that home resales will decline by 4.3% to 493,900 units in 2018, following a 4.5% drop in 2017.<\/p>\n<p style=\"text-align: justify;\">\u201cWe predict home resales to dip for the second straight year \u2014 something Canada hasn\u2019t seen since the mid-1990s,\u201d he writes.<\/p>\n<p style=\"text-align: justify;\">But if all this sounds worrying, Hogue doesn\u2019t think it should be. He writes that the downward pressure on prices is a natural correction that is long overdue.<\/p>\n<p style=\"text-align: justify;\">\u201cWe see the risks of a major price correction nationwide as contained,\u201d he writes. \u201cWe expect demand-supply conditions to remain balanced in the majority of local markets, including Ontario and British Columbia. Solid economic demographic fundamentals will maintain steady support.\u201d<\/p>\n<p style=\"text-align: justify;\"><a href=\"http:\/\/news.buzzbuzzhome.com\/2018\/05\/two-years-double-digit-growth-heres-canadian-home-prices-may-increase-1-8-per-cent-2018.html\" target=\"_blank\" rel=\"noopener\">After Two Years of Double-Digit Growth, Here&#8217;s Why Canadian Home Prices May Only Increase by 1.8% in 2018<\/a> by Sarah Niedoba | Buzz Buzz Home<\/p>\n","protected":false},"excerpt":{"rendered":"<p>As Canadian year-over-year home sales and prices have continued to drop, many economists have predicted that activity will begin to heat up again in the second half of the year. &hellip; [<a href=\"https:\/\/www.roryc.ca\/blog\/2018\/05\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\/\">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-9119","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>Aggregate Home Prices will Increase by Only 1.8% Nationwide in 2018 &#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\/05\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Aggregate Home Prices will Increase by Only 1.8% Nationwide in 2018 &#8226; Rory C Real Estate | Oakwyn Realty\" \/>\n<meta name=\"twitter:description\" content=\"As Canadian year-over-year home sales and prices have continued to drop, many economists have predicted that activity will begin to heat up again in the second half of the year. &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\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/\"},\"author\":{\"name\":\"Rory Clipsham\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/#\\\/schema\\\/person\\\/0672b9777e67473b9bd9247df49499c7\"},\"headline\":\"Aggregate Home Prices will Increase by Only 1.8% Nationwide in 2018\",\"datePublished\":\"2018-05-22T17:10:37+00:00\",\"dateModified\":\"2018-05-22T17:24:23+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/\"},\"wordCount\":388,\"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\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/\",\"url\":\"https:\\\/\\\/www.roryc.ca\\\/blog\\\/2018\\\/05\\\/aggregate-home-prices-will-increase-by-only-1-8-nationwide-in-2018\\\/\",\"name\":\"Aggregate Home Prices will Increase by Only 1.8% Nationwide in 2018 &#8226; 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