Interest rate hike could see 30 per cent price slump

Home prices could fall by as much as 30 per cent if there was a sudden hike in interest rates.

As part of a stress test conducted by the Canada Mortgage and Housing Corporation, it concluded that its business would suffer a loss but could withstand a hike. However, for homeowners the pain could be severe.

Interest rates are not the only risk factor for a sharp correction of home prices. A severe and prolonged depression could see a 25 per cent slump for prices.

CMHC said that none of the scenarios it has tested should be taken as predictions.
 

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate

Market update:

Get help choosing the best mortgage rate

Just fill in a few details, and we'll arrange for a Mortgage adviser to help you find the best mortgage for your needs

  • How soon do you want a mortgage?
  • Name
  • Where do you live?
  • Phone number
  • E-mail address

Industry news

Submit a press release

Poll

Should government update pot rules to prohibit growing in rentals?