Stress test effect is showing nationwide says RBC
Steve Randall
Canadian Real Estate Wealth
The impact of the tightened mortgage rules introduced at the start of the year appears to be rising.
A report from RBC Economics says that softening sales in February, following a slowdown in January, suggest a trend that is being felt across the country.
Highlighting data from local real estate boards, RBC says that price trends appear to be holding up, but that sellers are facing a weakened bargaining position.
The decline in Toronto (almost 35% year-over-year) in March translates, on a seasonally-adjusted basis, to a rough calculation of an 8-year low according to RBC.
There are some bright notes in RBC’s analysis though with an uptick in listings in February which it says could suggest increased move-up buyer activity in the coming months.
In conclusion, the report says that the B20 mortgage rule changes appear to have shifted homebuying decisions forward into 2017 with a corresponding dip at the start of 2018.
It forecasts that the impact of the new tightened rules will gradually ease in the coming months.
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