January 21, 2021, by Jessy Bains
Canada Mortgage and Housing Corporation (CMHC) says house prices could fall 47.9% peak-to-trough with an unemployment rate of 25% in its worst case scenario.
CMHC says without government intervention, its solvency and capitalization would be in question. Even with help, the agency says prices would fall 31.8% and the unemployment rate would be 24.2%.
CMHC CEO Evan Siddall made headlines in May when he forecast a decline in average house prices of 9 to 18% in the coming 12 months, but that hasnâ€™t panned out so far with record price appreciation in many markets.
“As we continue to deal with the impacts of the COVID-19 pandemic, it is important to monitor the evolving financial risks facing Canadian housing markets including an uneven economic recovery impacting most vulnerable populations,â€ said CMHCâ€™s chief risk officer Nadine Leblanc, in a release.
What does this mean?
This article is fascinating, even enlightening, but you may have no idea what to do with the information it provides.
Itâ€™s dangerous to load up on knowledge and move without the practical wisdom to act.
Every week, our coaches post real estate insights and stories from the streets. They unpack real deals, breaking down the numbers, and highlight trends that their clients are making money off of.
Their wisdom is freely available to you right here.
Sign up for the iWIN Real Estate Newsletter now so you never miss the practical wisdom we are already sending to thousands of investors in Ontario.