From Financialpost · · 1m
Affordable Housing Window Closing in Canada
Economists warn Canada's affordable housing window is closing as prices fall and interest rates rise.
In brief
Economists warn Canada's affordable housing window is closing as prices fall and interest rates rise. Canada's housing affordability is declining as home prices drop but rising mortgage costs threaten to reduce buyer capacity by 9%. Originally reported by Financialpost.
Housing Affordability Cycle Ending
Home prices have fallen around 20 per cent from pandemic peak levels, improving affordability for buyers.
RBC Reports Cycle Nearing End
Royal Bank of Canada says the housing affordability improvement cycle is nearing an end for Canadian buyers.
Small Income Gains Boost Affordability
Rising household incomes improved affordability slightly in the second quarter, but gains were small.
Bond Yields Signal Higher Costs
Rising bond yields mark a turn for the worse for ownership costs as mortgage rates rise.
“mark a turn for the worse for ownership costs”
Mortgage Rates Could Rise 9%
Five-year fixed mortgage rates could rise from 4.1 per cent toward 5 per cent, reducing buyer capacity by 9%.
“five-year fixed mortgage rates could rise from 4.1 per cent toward 5 per cent”
Energy Prices Add Pressure
High energy prices will raise utility bills and worsen affordability challenges for buyers.
In short
Canada's housing affordability is declining as home prices drop but rising mortgage costs threaten to reduce buyer capacity by 9%.
