The next 18 months will see a further slowdown in housing activity, according to Hogue, as potential buyers are pushed away by the higher cost of borrowing.
He added that in the upcoming months, buyers should be on the defensive due to the likelihood that the Bank of Canada will raise its policy rate further into restrictive territory by year’s end.
“Higher interest rates will disqualify more buyers from obtaining a mortgage and shrink the size of a mortgage others can qualify for. We project home resales to fall 23 per cent in Canada this year and a further 15 per cent next year.”
Read more: 38% of Canadians unsure what rising rates imply for them
Overall, according to Hogue, prices will bottom out by the beginning of next year, though the pain will be felt more keenly in British Columbia and Ontario, where prices rose sharply during the pandemic.
