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Canada’s Housing Market in 2017 — Toronto BOOM, Vancouver BUST?

1,271 views · Published 1 January 2017 · 9:12 · Indexed 14 November 2026

Channel: Mike Martins · 2017 · News & Politics

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Happy New Year! It’s January 1st, 2017, and I’m kicking off the year by looking at what could happen to the Canadian housing market over the next 12 months.

Housing has become one of the biggest conversations in Canada. Vancouver prices have reached levels that many working people simply cannot afford, Toronto continues to run hot, and new mortgage rules are making it increasingly difficult for first-time buyers to qualify.

In this video, I go through an article laying out several major predictions for Canadian real estate in 2017.

Toronto could remain one of the strongest markets because demand for detached and semi-detached homes continues to exceed supply. Vancouver is a completely different story. The market began cooling toward the end of 2016 following the introduction of British Columbia's foreign buyer tax, and there are major questions about whether prices could continue falling.

Then we have the new mortgage stress-test rules. First-time buyers may see their purchasing power significantly reduced, meaning they'll either need larger down payments, settle for cheaper properties, or continue renting.

Another factor I'm watching is the United States. With Donald Trump taking office, rising U.S. bond yields and potentially higher interest rates could eventually affect Canadian borrowing costs. If mortgage rates start moving higher while Canadian households are already carrying enormous debt loads, what happens to housing?

My own prediction remains much more bearish than some of the experts quoted in this article. I'm predicting a smaller correction beginning around March 2017, followed by the possibility of a much larger correction by the summer.

I've been following Vancouver housing for years, and I continue to believe an economy cannot depend indefinitely on continually rising real-estate prices.

What happens when listings increase? What happens when people need to sell because of divorce, inheritance, relocation, retirement or financial pressure? Once properties begin selling below previous comparable prices, could those lower sales start resetting expectations throughout entire neighborhoods?

2017 could be an extremely important year for Canadian housing.

Let me know your prediction below.

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