Is Toronto’s housing market finally cooling? Experts say they’re already seeing signs it’s slowing down

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Mortgage rates are soaring, home sales are dropping and realtors are seeing fewer multiple offers. It looks like rising rates could finally stabilize our blazing housing market.

Daniel Foch, a Markham-based realtor, has noticed a recent change in the buying behaviour of his clients: most used to bid on homes at a feverish pace — eager to get in the market while interest rates were low — but now they’re taking a “wait and see” approach, carefully calculating the right time to buy.

The central bank’s overnight rate, which grew to one per cent in April, has raised the barrier to entry for first-time buyers required to pass the federal government’s mortgage “stress test.” Higher mortgage rates are hampering Canadians’ purchasing power — and it shows. “The current prognosis is that we won’t see big month-over-month appreciations like we have throughout the pandemic.”

Canadians are vulnerable to higher interest rates, some economists say, as household debt now sits at a record 186 per cent of household disposable income, compared with 181.1 per cent before the pandemic, according to Statistics Canada. For every dollar earned, the average Canadian has $1.86 in debt.

 

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Rent caps plus punitive taxation on rental, income and investment properties along with punitive taxation on empty homes.

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