Average home prices in Canada are set to fall around 9% this year and then rise into 2024 and beyond as buyers bet interest rates have already peaked alongside strong demand for housing, according to property analysts polled by Reuters.

The Bank of Canada raised rates rapidly from near-zero early last year to 4.25% in January, but that has failed to be a significant drag on home prices, which have fallen about 15% since last March after surging over 50% since the start of the pandemic in early 2020.

Since the Canadian central bank opted for a conditional pause on rate rises in January this year, home prices in Canada have started climbing again and are up a cumulative 17% so far this according to the report.

The 15 May - 5 June Reuters poll of 11 analysts predicted around a 9% fall in home prices in 2023, milder than the 12% fall forecast in a poll three months ago and the 12% decline in April from a year earlier reported by the Canadian Real Estate Association.

Average home prices were expected to rise about 2% and 4% in 2024 and 2025, respectively, similar to median predictions in the last poll.