Nevertheless, the magnitude
of house price gains is leading to increasing concern about the possibility of this boom turning to bust once mortgage rates begin to rise.
Royal LePage forecasts modest
house price gains for remainder of 2013, as Canadian housing emerges from current market cycle TORONTO, July 9, 2013 — The average price of a home in Canada increased between 1.2 per cent and 2.7 per cent in the second quarter of 2013, according to the Royal LePage House Price Survey -LSB-...]
This induced expectations of still
more house price gains, further increasing housing demand and prices (Case, Shiller, and Thompson 2012).
Royal LePage forecasts
modest house price gains for remainder of 2013, as Canadian housing emerges from current market cycle
Widespread House Price Gains Have Accompanied Accommodative Financial Conditions (Diffusion Index of House Price Growth and Global Financial Conditions)
«Historically strong inflation -
adjusted house price gains are tempering consumer sentiment, whereas consumer optimism regarding the ease of getting a mortgage reached a survey high.»
«The shifting of some markets off the IMI in June underscores the fragile nature of the housing recovery as well as the fact that many locations that previously made the list had recorded only
marginal house price gains, which were easily wiped out by small downward changes,» notes NAHB Chief Economist David Crowe.
Having acquired so much debt, Canadians are vulnerable to rate increases, and
housing price gains have vastly outpaced wage growth.
According to the RBC report, new home construction and house resales are expected to soften nationwide in 2007, alongside more reined - in expectations for
house price gains.