Friday, November 21st2.3°C
24124
23791

RBC forecasts Canadian housing market will cool in 2015 if interest rates rise

TORONTO - RBC Economics says higher interest rates will put a strain on the Canadian housing market in 2015 and "substantially" moderate prices increases.

In its latest Canadian housing forecast, the bank (TSX:RY) says Canada's current historically low interest rates are not "sustainable" and it forecasts longer-term interest rates will rise by the end of the year in anticipation of a return to tightening mode by the Bank of Canada in 2015.

RBC says if current rates rise, it anticipates home resales to fall by 0.9 per cent to 463,100 units next year following an increase of 2.1 per cent to 467,200 units in 2014, while it sees home prices increasing just 1.1 per cent in 2015, compared with a jump of 4.3 per cent this year.

RBC describes those developments as a cooling not a crash in the housing market, which is supported by a variety of other factors, including steady immigration rates and good employment outlook.

The report said condo construction, particularly in the major cities, will be one of the main reasons the housing market will slow in 2015 as more units become available.

It cautioned that although there will be slowdown in 2015, the big impact on the Canadian housing market will be likely not be seen until 2016 once higher interest rates are "normalized."

The Canadian Press


Read more Business News

22899


Recent Trending




Today's Market
S&P TSX15129.74+54.561
S&P CDNX791.968.39
DJIA17836.15117.15
Nasdaq4724.364+22.497
S&P 5002065.71+12.96
CDN Dollar0.8905+0.0063
Gold1204.30+13.40
Oil76.42+0.57
Lumber331.50+4.50
Natural Gas4.343-0.146

 
Okanagan Companies
Pacific Safety0.155-0.005
Knighthawk0.01-0.005
QHR Technologies Inc1.26-0.01
Cantex0.035-0.005
Anavex Life Sciences0.165-0.005
Metalex Ventures0.03+0.005
Russel Metals31.59+0.79
Copper Mountain Mining2.28+0.10
Colorado Resources0.14+0.01
ReliaBrand Inc0.013-0.002
Sunrise Resources Ltd0.050.00
Mission Ready Services0.33-0.005

 
23744


23459

FEATURED Property
2142969 1930 Abel Street
$449,000
more details
image2image2
Click here to feature your property
Please wait... loading


What I learned in China: Part 2

As per my previous article on my visit to China, we have much to learn about and from their people. It is potentially the largest market on earth with 1.3 billion people in one country but much will d...


Retirement: Health Issues

Our health is really our greatest asset and maintaining our health is of tremendous importance. You want to do what you can to ensure that health issues will not jeopardize the enjoyment of your retir...


Be quiet already!

No, you’re not crazy. There really are voices in your head. Voices that keep you from doing what you need to do during your customer care calls. It can be the voice of your teachers, your parent...

_



24156

24158


Member of BC Press Council


22962