The report from senior economist Robert Hogue notes that it’s likely that the surge in activity towards the end of 2017 was due to buyers rushing to beat the tightening of mortgage rules.
Without that spike, activity and prices were already slowing in many markets and this trend is expected to continue in 2018.
Although Hogue says that momentum in the resales market may be higher than previously forecast, the tightened mortgage rules; and interest rates which RBC believes will hit 2% by year-end; will keep the market in soft-landing mode.
The outlook is for most markets to remain balanced this year as more sellers list their homes and the lower expectations for price appreciation dampens speculation in hot markets such as Toronto.
There are some concerns though including the continued price rises in Vancouver, especially for condos. Nationwide though, prices are forecast to rise just 2.3% from 11.1% in 2017.
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The latest assessment of Canada’s housing markets from RBC Economics calls for a soft landing course for activity and price increases being restrained “substantially.”