The Toronto-Dominion banking group says Vancouver and Toronto home prices will probably experience a relatively mild downturn in two to three years — but not the dramatic drop that hit the United States a few years ago.
TD says a 15 per cent decline in Canada’s two most expensive cities is likely in a few years but it will be gradual, rather than the sudden drop of 30 per cent seen in the U.S. real estate market.
The bank’s analysis is consistent with other warnings that Vancouver and Toronto real estate is generally overpriced but supported by low interest rates and a stable economy.
TD says that’s not likely to change this year unless there’s a major economic shock from outside the country.
In the meantime, TD says Vancouver’s real estate market is stabilizing after soaring last year.
But it believes Toronto prices for some types of homes are poised for a robust increase.