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Two new forecasts out Wednesday suggest the Canadian housing market may still have a little more room to grow but the pace of price increases will slow in 2016.

Fitch Ratings suggests prices across the country will grow by 2.5 per cent this year but the ratings agency also is concerned about downside risk in the housing market.

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“National prices (are) 20 per cent overvalued compared to growth in long-term economic fundamentals leaving markets exposed to downside risk,” the company says in its global housing and mortgage outlook. “No significant downward price movements are expected.”

The agency went on to cite affordability as a concern in the marketplace and noted household indebtedness is 165.5 per cent of disposable income, among the highest of countries it rates.