Canadian real estate markets are expected to fumble in the first half, but make up for it in the second. RBC Economics shared its latest forecast for Canada’s housing markets this morning. The country’s biggest bank believes interest rates are running the show, and the first six months of 2024 will be slow. As rate cuts begin to appear by mid-year, they expect sales will get a boost—though not enough to prevent prices from falling this year.
Canadian Real Estate Markets To Have A Slow Start To 2024
Canadian residential real estate markets are expected to see a slow first half to the year. There’s been some mild relief when it comes to financing fixed rate mortgages, but not enough for prices at these levels. Especially with elevated interest rates.
“We expect slow activity and softening prices in the early part of the year as the Bank of Canada keeps its policy rate high,” explained Robert Hogue, assistant chief economist at RBC.
Adding, “Interest rates will continue to dictate the outcome of Canada’s housing market in 2024. But a pivot toward rate cuts mid-year will get the wheels turning faster over the second half or perhaps even sooner.”
Considering the Spring market is the busiest time of year, this can have a big impact on prices. Fewer buyers and a lot more inventory can apply more downward pressure. Virtually every economist expects rate cuts though, so this may not be an issue for very long.
Rates Cuts In The Second Half Will Boost Home Sales In Canada
RBC is on the same page with virtually every economist in Canada, expecting lower rates by mid-year. That will combine with other pro-market factors such as rapid population growth, stronger than expected wage growth, and pent-up demand. Consequently, the bank has a potential
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