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The Metro Vancouver housing market will see higher sales and modest price increases over the next two years, according to a Canada Mortgage and Housing Corporation forecast.

The CMHC report, released Thursday, forecasts income and population growth will not only support a rebound, but also create a balanced housing market in Metro Vancouver through 2020 and 2021.

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“While inventories of homes for sale are expected to decline slightly as sales increase, a growing number of newly constructed homes coming onto the resale market will help keep market conditions balanced overall through the end of the forecast horizon,” the report says of the Metro Vancouver region.

Mortgage qualification rules, also known as the B-20 stress test, will limit the borrowing capacity of some home buyers, the CMHC report said, which will limit price growth. However, it also said greater discounts on mortgage interest rates will lend support to the housing market.