Starting this month, it's going to be harder to buy a house. The new federal banking regulations will require a “stress test” for borrowers of conventional mortgages to ensure that they can afford higher rates. This means that home buyers have lost significant purchasing power. The Bank of Canada estimates that this will disqualify one in ten mortgage seekers. This in turn is predicted to lead to a 10 to 20 percent decline in house prices. When you combine this with the rise in interest rates, this should keep Canada’s housing markets relatively quiet through the first half of 2018.

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