2015-20 Interest rates and house prices

One of the biggest issues in Canada is the boom in house prices, especially in Vancouver and in Toronto.
Why are prices going up? The main reason is low interest rates. The rate on a 5 - year discount mortgage is now 2.5%; it was 5% before the Great Recession. Mortgage payment is the same on a loan 30% higher when the interest rate is 2.5% rather than 5%. And of course, as house prices go up, people rush into the market.
Why is this a problem? Because, eventually, interest rates will goup and the housing market may crash.
Also, with baby boomers starting to downsize, the demand for housing may start to fall.