According to Canada’s Finance Minister Jim Flaherty, the national housing market has finally started to cool down.Economists have been arguing about Canada’s chances to come out of the recession with its extremely high market activity.
Meanwhile, the recent spring data shows that in most Canadian cities there were notable sales declines as compared to the same period in 2011. In addition to it, the price gains started to moderate.
“I’m really satisfied with the market showing some corrections this time,” – Mr. Flaherty noted during his latest visit to Alberta. “Of course, it’s not so vivid in Toronto, but we can see certain changes in Vancouver. In general, we’ve seen some notable moderations at the residential market and it’s quite encouraging.”
Although there were some rumours about the federal government implementing new mortgage qualification rules, government decided not to interfere.
Mr. Flaherty has only issued warnings to Canadian borrowers instead of enacting the new policy. He reminded: “We’ve already warned the Canadians about the necessity of being prepared for higher interest rates in the future. It’s extremely important to understand that affordability level may go down in time for some borrowers as the rates start rising. And it’s definitely going to happen one day, because rates can’t remain low for so long. That’s why we should be very careful with our financial planning.”
We’ll get more information on the Canadian housing market activity next week when the Canadian Real Estate Association releases its March report.