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Canadian home prices to fall in real terms next year as affordability, mortgage rules bite: Fitch

Canadian house prices in real terms will fall modestly next year because they’re out of reach for many buyers and others that want to enter the market can’t get loans, according to debt assessment firm Fitch Ratings.

The country will see house price growth of about 1 per cent, which, when set against inflation of around 2 per cent, will mean a real decline, Fitch said Tuesday in its Global Housing and Mortgage Outlook — 2020.

“We think stretched affordability (especially in Toronto and Vancouver) and macro-prudential measures that limit the number of borrowers able to qualify for home loans will continue to limit home price growth,” Fitch analyst Susan Hosterman wrote. “Home price growth in both markets has been limited by national lending limits and local purchase restrictions.”


Compared to 23 other countries in the outlook, Fitch’s forecast for house price growth in Canada comes in near the bottom Click To Tweet