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Real Estate

Rate Hikes Hit Canada Housing With First Price Drop in Two Years

  • Sales plunge 12.6% as borrowing costs begin to rise sharply
  • Price declines are heaviest in smaller markets around Toronto
Rate increases have left Canada’s housing market looking increasingly vulnerable.

Rate increases have left Canada’s housing market looking increasingly vulnerable.

Photographer: Cole Burston/Bloomberg
Updated on

Canadian home prices fell for the first time in two years as a rapid rise in interest rates looks set to threaten one of the world’s hottest housing markets.

Benchmark home prices declined 0.6% in April from the month before, the first drop since April 2020, according to data released Monday from the Canadian Real Estate Association. The number of sales, meanwhile, plunged 12.6%.