Capital Economics’ David Madani is predicting a sharp drop in property prices in Calgary.
Capital Economics’ David Madani is predicting a sharp drop in property prices in Calgary. He says that in regions directly affected by lower oil prices lower mortgage rates won’t stop listings rising and prices falling. In a research note Madani acknowledges that the lower rates may help some other markets but in areas like Calgary it is likely to make things worse: “We fear that this will only fuel greater overvaluation, higher household debt and more overbuilding.” He says that Toronto and Vancouver will see the benefits, as shown by recent sales figures in those markets, but for the oil-dependent provinces: “We remain deeply concerned over the longer-term prospects for the housing market.”
