Sadiq Adatia, chief investment officer of Sun Life Global Investments Inc., recently provided that grim assessment at the Bloomberg Canadian fixed-income conference in New York.
“I don’t think the demand is going to be there for housing,” Adatia announced before an audience full of industry stakeholders, according to the National Post. “I do think it’s a dead cat bounce.”
August saw home sales surge in Canada's largest markets, Toronto and Vancouver. This shows a return to a seller's market, as the increase was brought forth by the impending fear of rising interest rates.
As fixed rates continue their upward trend, the real concern is that movement will continue and directly affect demand, especially as Canadians struggle to qualify for mortgages..
The original expectation was for falues to drop significantly, especially after coming off of new mortgage rule changes in July 2013.
While the number of sales did experience a decrease, prices in Canada's largest housing market continued their upswing, a trend that may continue, going forward.
Adatia indicates that growth is unsustainable in a market where interest rates are constantly high. However, several other market analysts disagree with this analysis.
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