Canadian real estate prices are back to surging after a correction that barely lasted a year. However, the momentum carrying prices higher isn’t expected to last very long after the latest Bank of Canada (BoC) rate hike. RBC, the country’s largest bank, expects rising interest rates will throttle demand at a time when more supply is finally beginning to appear. The result will be a much more balanced market, helping to calm the credit-driven price growth that re-appeared with easing central bank expectations.
Banks are extending loan periods, allowing people who have bitten off more than they can chew to hold on a little longer.
That just kicks the can down the road.