RBC economist forecasts house prices to decline as interest rates will inevitably increase. These forecasts are for 2015/2016 and are also nationwide.
An economist at Canada’s biggest bank says home prices could start falling in 2016 if interest rates return to more normal levels. And he warned that, in the meantime, what goes up will likely come down if salaries and incomes don’t keep pace.
“The higher home prices get relative to income by the time rising interest rates really start to bite, the more prices will have to adjust (downwardly) over time to keep longer-term affordability from reaching intolerable levels,” Royal Bank of Canada economist Robert Hogue wrote in a research note Wednesday. “This means that any price increases exceeding the rate of household income gains in the near term (2014 and 2015) likely would result in steeper price declines down the road.”
Click here to read the full article >>> RBC economist predicts home price declines in 2016 as rates rise by Tara Perkins)
Click here to read the full article >>> RBC economist predicts home price declines in 2016 as rates rise by Tara Perkins)
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