The assessment of the housing market says that the downward trend in home sales in the Vancouver market began well before the introduction of the 15 per cent sales tax on foreign buyers; it began in March with single-family homes and spread to apartments in July.
National Bank believes that Vancouver will start to see a correction in prices with a reduction of 10 per cent overall over the next 12 months with detached homes suffering a 20 per cent drop.
For Toronto, the report says that high prices driven by tight supply will begin to ease as higher mortgage rates and Ottawa’s new mortgage rules soften sales. The tight inventory will, however, mean that the price drop will be far lower than in Vancouver at around 3 per cent.
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Home prices in Vancouver and Toronto are facing an imminent correction according to a special report from National Bank.