Net new immigration, scarcity of housing supply, economic growth and first time home buyers entering the market will put upward pressure on housing prices,” advised James Laird – co-founder of RateHub Inc. and president of CanWise Financial. “The macroeconomic factors that have been driving price appreciation will persist in 2018.
“However, the new stress test that comes into place on January 1, 2018, combined with rising interest rates, and recently introduced foreign buyers taxes will act as an effective counter-balance, causing no net-change.”
Unfortunately, the number of Canadians that will be forced to borrow from unregulated lenders will only increase this year, Laird warned.
“All of the recently added regulation combined with the [OSFI stress test] will cause more Canadians to borrow from unregulated lenders at higher rates. Canadians who need to refinance and no longer qualify will be forced this way, while some who are looking to purchase and no longer qualify with a regulated lender will choose to go this way.”
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