Low mortgage rates showing signs of turning around housing market
Article by Tara Perkins, The Globe and Mail, August 14, 2014
“Forecasters are hiking their expectations for Canada’s housing market amid signs low mortgage rates are energizing sales, construction and prices.
The revised predictions come at a time when many economists thought that the growth in the market would be stalling. But now many experts believe the recent strength is more than simply compensation for a slow winter, although most still think the market will lose some steam eventually.
Canada Mortgage and Housing Corp. said Wednesday it expects the average price of houses sold over the Multiple Listing Service (MLS) to rise 4.5 per cent this year to $399,800. Less than three months ago, CMHC was expecting a 3.5-per-cent gain this year to $396,000, and back in June, 2013, it forecast that the average sales price this year would be just $377,300.
Its new outlook came as the latest Teranet-National Bank house-price index reading suggested that prices rose 1.1 per cent in July from June. That marked the first time in five months that prices rose by more than the historical average for that month, and the eighth month in a row that prices rose.”
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