TORONTO – A new forecast suggests Ontario home prices will rise about four per cent a year through 2016, down from a decade-long annual average of about six per cent.
The forecast by Central 1 Credit Union says higher mortgage rates in the next three years will restrain housing sales but not cause a market correction.
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It also predicts the Toronto condo market will slow as builders delay new construction in the face of weaker demand.
Central 1 says the total number of new condos in Toronto in pre-construction, under construction, occupancy and sell-out phases will be about 100,000 units at the end of 2013.
Chief economist Helmut Pastrick says fears of a housing bubble and a price collapse are misplaced and predicts rising population and land supply restrictions will result in Toronto house prices doubling over the next 25 years.
Central 1 also predicts Ontario’s overall rental apartment vacancy will hold steady at 2.6 per cent through 2014, before declining to less than two per cent in 2016.
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