Originally posted on Bllomberg by Ari Altstedter on July 25, 2022
Residential condo buildings and single family homes near Burrard Inlet in North Vancouver. Photographer: Darryl Dyck/Bloomberg
Home prices in the once-hot market could slide even further as investors choose to sell.
At the tail end of a historic bull run in Canada’s housing market last year, investors came to comprise a fifth of the country’s homebuyers. Now, they are some of the first scrambling to unload properties in what some are already saying could be the most severe housing market downturn in the country’s recent history.
In early July, Toronto-based mortgage broker Ron Butler’s client called him with exactly that dilemma: The financials on the suburban condo he purchased as an investment property just four months earlier no longer made sense. Rents could no longer cover interest payments on the mortgage after a six-fold jump in the central bank rate.