Information about local real estate market conditions
Saturday, September 14, 2019
Real Estate Market Buying and Selling
The Canadian real estate market is heating up again!
After a cool-down in 2018, economists predicted a modest rebound this year. However, the housing market has exceeded expectations with total national sales volume on the rise since March. July sales were up 3.5% from the previous month and 12.6% higher than last year.1
So what triggered this faster-than-expected turnaround and renewed market activity? And is it sustainable?
To answer these questions, we take a closer look at some of the key indicators and explore what they mean for buyers, sellers, and homeowners.
HOME VALUES ARE RISING
The scenario varies by market, but nationally, home values are on the rise. According to the Canadian Real Estate Association (CREA), the average sales price in July was up 3.9% from the same month last year. And CREA’s Aggregate Composite MLS Home Price Index—which can more accurately track pricing trends across comparable homes—shows a slow but steady climb since January.1
Toronto-Dominion Bank Economist James Marple attributes the increase in housing prices and sales activity to positive economic fundamentals. “As they have in the past, strong population growth, solid job growth and lower mortgage rates appear to be doing the job of supporting Canadian housing demand.”2
“The immediate downside risk to home prices have diminished considerably,” Marple added. “While affordability will remain a constraint in major high-priced markets, prices appear more likely to increase than decrease over the next year.”2
What does it mean for you? Those who were concerned about a market crash should take comfort in these latest numbers, which indicate that the cooling effects of the stress test are diminishing. If you’ve been waiting on the sidelines to buy, don’t let fear hold you in limbo. The market is cyclical, and home prices will continue to fluctuate. But over the long term, real estate has consistently proven to be a good investment.
FIXED-RATE MORTGAGES ARE ON SALE
Historically, Canadians have had to pay a premium for a fixed-rate mortgage. Those who wanted to lock in a set payment for five years were charged a higher rate of interest. But a slide in the international bond market has made it cheaper for mortgage lenders to offer fixed-rate mortgages than variable ones.3
In fact, rates on standard five-year fixed-rate mortgages are at their lowest level in two years. Meanwhile, in July, the Bank of Canada dropped its five-year benchmark rate for the first time since September 2016. The rate, which is used in the bank’s mandated mortgage stress test, was dropped from 5.39% to 5.19%, making it easier for borrowers to qualify for a mortgage.4
These lower rates have given a boost to buyers and the market in general. “We’ve now had a reawakening of sales for several months,” said Avery Shenfeld, chief economist at CIBC Capital Markets in Toronto. “In addition, mortgage rates have been edging lower so the combination of the two is making for an active market.”5
What does it mean for you?
If you’re looking to buy a home, now is a great time to lock in a low fixed-rate mortgage. Not only will you save money, it will also guarantee you a predictable monthly payment (and peace of mind) over the next several years.
NEW INVENTORY IS ON THE WAY
Across the country, new home starts are on the rise. The uptick in construction is being led by Montreal and Vancouver, while Toronto—which tops the continent in number of active cranes—is beginning to see a decline in starts.6
July construction levels were 10% higher than the previous year and 17% higher than the median rate of growth over the last 10 years.6
Meanwhile, the number of new real estate listings in July declined slightly by .4%.5The Royal Bank of Canada predicts this will help balance the incoming pipeline of new construction. “Elevated levels of apartment construction in Vancouver, Toronto and Montreal raise some longer-term absorption issues. There’s little risk near term as unsold inventories are low at the present time.”7
What does it mean for you?
If you’ve had trouble finding the right property in the past, you may want to take a look at new options hitting the market. And if you’re planning to sell your current home, now may be a good time to list. Competition from new construction is likely to increase over the next few years.
HOMEOWNERSHIP IS BECOMING MORE AFFORDABLE
According to the National Bank of Canada, housing is finally becoming more affordable. In fact, during the second quarter of this year, the cost of owning a home, relative to income, fell to its lowest level in a decade.8
An increase in wages, combined with falling mortgage rates, is helping to bring the relative cost of homeownership down. The average percentage of household income that went toward a mortgage payment fell from 48.7% to 45.1% in the 11 major cities included in the report.8 Of course, it’s still significantly higher than the 30% benchmark that is generally considered optimal.
So, while many Canadian markets may be a long way from being considered “affordable,” the trend seems to be moving in the right direction.
What does it mean for you?
If you’ve previously been unable to afford or qualify for a mortgage, it may be worth another try. A decline in mortgage rates, an increase in housing supply, and a lower stress test benchmark rate could help put your dreams of homeownership within reach.
I'M HERE TO GUIDE YOU
While national real estate numbers can provide a “big picture” outlook, real estate is local. As a local market expert, I can guide you through the ins and outs of our market and the issues most likely to impact sales and home values in your particular neighbourhood.
If you have specific questions or would like more information about how market changes could affect you, contact me to schedule a free consultation. I'm here to help you navigate this shifting real estate landscape.
- Canadian Real Estate Association -
- CBC -
- Global News -
- Global News -
- Global News -
- Better Dwelling -
- Royal Bank of Canada - http://www.rbc.com/economics/economic-reports/pdf/canadian-housing/healthcheck-august18.pdf
- Huffington Post -
Friday, July 26, 2019
Real Estate Market
Two infographics released yesterday and shown below, reveal the hottest housing markets within Hamilton and Burlington, evidencing how most nieghbourhoods in both cities are sizzling sellers markets and which are not, as hot, or in rare cases, favor buyers.
Both Hamilton and Burlington have seen explosive growth over the past decade, with 147% growth for Hamilton and 31% for Burlington and demand continues to rise. Sources indicate “Surging demand in these cities is likely driven in part by their comparable affordability; despite home prices more than doubling over the past decade in each, the average hit $526,762 in Hamilton and $738,905 in Burlington in June – considerably lower than the average of $915,481 in the neighbouring City of Toronto.”
Although significantly lower house prices than Toronto are certainly attractive and may indeed be a large contributor driving-up interest in both cities, buyers are now more likely to face steeper competition, “as new data reveals Hamilton and Burlington remain steeped in scorching sellers’ markets.”
Burlington’s Hottest Neighbourhoods – Infographic
Most Popular Hamilton Markets Located On Mountain – Infographic
Curious what your house is worth or thinking about selling? Call or email me today for a free consultation and home evaluation!
905-330-5201 or email@example.com
Original source: https://www.zoocasa.com/blog/buyers-sellers-markets-hamilton-burlington-june-2019/
Monday, July 22, 2019
House and Home Real Estate Market Buying and Selling
- THE RIGHT KIND OF REALTOR®
Prepositioning your home prior to listing is the best way to optimize its sale price as well as the terms of sale in your favor and open houses, are one of the most common and effective ways to show and sell it. Open houses however, are not a favored tactic by all REALTORS® and obviously, among those that do use them, there are vastly different levels of capacity.
With 60-70,000 REALTORS® in Southern Ontario alone and the market experiencing more difficulty moving properties than in recent years, selecting the right REALTOR® for you can have dramatic effects on whether your home even sells, as well as the sale-price and terms of sale if it does sell. This article can help you with both outlining some of the most powerful and proven prepositioning methods you and your agent should focus on, while also giving you some key aspects to consider and ask potential agents about to help you select the right representation.
What would you invest in time and money to get an extra $7,000, $15,000 or $25,000 for your current house? The differences in how you handle the elements below can certainly add up to a lot more too, so go through this list carefully and consider both, what you’re willing to do yourself and pay for assistance with, as well as how well equipped your realtor® is to first properly preposition and then, sell your home using open houses.
- ARE YOU A DESIGNER? GET HELPFUL ADVICE OR HIRE ONE!
Even if professional staging and design isn’t in the budget, you probably know a few people who can help in a major way - without even minor inconvenience to them or you. Your REALTOR® should really be your go-to guide for all elements discussed below, so again, make sure they offer you tons of helpful advice and suggestions on all fronts as well as perhaps a bit of help with the finer details on the staging side if you don’t end up hiring a professional. Also, ask your REALTOR® for help arranging for proper storage of all the furniture and items that end up being removed, from a properly prepared home for sale.
Plus, if you know a photographer, designer of any kind or even someone with a seriously enviable sense of style, they can be a huge help for almost all of us who need it. So don’t be afraid to invite the right kind of friend over for a quick visit and walk-through to get their advice. Make sure to go through your property inside and out and consider using this article in addition to your realtor’s® checklist as a guide.
- CLEANING, DEPERSONALIZE, DECLUTTER & STAGE YOUR HOME
Take this section seriously, because from cleaning and depersonalizing, to decluttering and staging (even if you do your own staging with the help of your REALTOR®) these items frequently make the biggest difference to sale-terms as well as overall sales success, of all topics discussed in this article!
On cleaning, think fancy hotel standards. First, do as much as you want to yourselves, then seriously consider hiring professional cleaners as well as carpet cleaning pros. Below we’ll discuss the benefits of also hiring a handyman to attend to all the tiny repairs that often make a monster difference as well as perhaps, getting someone to help with curb appeal and landscaping the yard and exterior.
When it comes to depersonalizing and decluttering your property (remember, it’s not your home anymore, you want a buyer and yourselves to start thinking about it as theirs) think minimalist and neutral. The idea is to create a blank canvas that will appeal to all possible senses of style as well as create the appearance of the largest possible amount of space, in each room of your house, the garage, each closet and even the yard outside. Allow minimalism and neutrality to be your two sole guides as you go through the entire home. Potential buyers can come in all shapes and sizes, with all kinds of varying tastes.
Do you collect anything? If you do, when it’s time to sell your house and in preparation for successful showings and open houses, it’s now time to lovingly pack away all personal collections and unnecessary items that define your own unique taste. The tiniest of things that you love, as well as buyers impressions of the previous owners themselves, can easily turn people off and you’d be amazed how quickly the decision to NOT buy your home can come about. The simplest of things, such as for example, your collection of owl, horse or pig items and all kinds of subtle impressions and ideas about previous owners can turn buyers away.
Most artwork from walls and floor pieces, should likely be removed and most certainly, remove all family photos! For artwork and knickknacks, leave only one or two well placed pieces for each room. Also remove every single item from all tables and countertops, including all appliances from the kitchen, everything from the bathroom counters (even everything from inside bathroom cabinets that’s not absolutely necessary) as well as completely clearing off coffee tables, end tables and table tops.
What to keep? Make sure your REALTOR® is experienced and expert in this area enough so that that they can offer enormous help re-arranging furniture and picking those one or two paintings and pieces of art for the walls and centerpieces of tables and countertops.
Make sure you also clean out all those closets, literally packing away all but the most necessary clothing items and leave the shelving bare or as close to as possible. Closets are often neglected, but can make a big difference when done right, to help people appreciate the amount of space there actually is. The human eye is a funny and strange thing. Most people can’t properly visualize the amount of empty space actually available in a room that’s packed (however cozily) full of furniture, items of all kinds filling corners, with knickknacks spread around and items hanging on the walls. Buyers also need the same kind of help with closet- spaces, so make sure your closets are as empty as possible!
For staging, depending on your situation and property, hiring a professional stager with the help of your REALTOR® can give you a massive advantage and lead to a much higher sale price, as well as more beneficial terms in-line with your ideal preferences. Ultimately, even if you hire a stager, unless you’re accustomed to paying others to do all manners of work around the house and in life to save you time, you might want to expedite and lower expenses by doing as much as possible yourselves first, when it comes to cleaning, depersonalizing, decluttering and staging, with again, help and advice from a great REALTOR®.
BOOST CURB APPEAL
Green is gold! One of the most obvious and impactful ways to boost curb appeal is to add fresh greenery, flowers and take care of your lawn. Even without spending time and money on major gardening, you can add planters and window boxes in key accent areas to significantly enhance your property’s exterior appearance.
Make the door standout! Painting a front door is an easy DIY job and even if you pay someone to do it, it’s a cheap way to make a big difference in curb appeal. Bold colours that enhance, versus clash with your existing exterior are recommended and don’t be afraid to go bright either. Just choose carefully before you paint and perhaps ask your REALTOR® or that design savvy friend for their recommendations.
Light up buyers first impressions! Porch string lights, fresh fixtures around the door, even solar powered lanterns can all work wonders to light-up the walkway, front porch, door and front of the home. Bear in mind that potential buyers often drive-by at night before and after viewings, so consider lighting up the property at night while it’s for sale to increase viewings and help potential buyers choose your property.
Mailbox makeovers and front door décor matter! Consider swapping out a dated or drab mailbox for something stylish. Or once again, a fresh coat of paint is a cheap and easy way to turn a negative into another positive element to first impressions. Like many parts of our human awareness, first to even post-viewing impressions are often primarily subconscious and all tiny visual details matter more than you might think. For front door and entrance décor, ask your REALTOR® as always and depending on the property, everything from a small inviting porch table and chairs to planters on either side of the front door and the perfect rented entry-table for inside the entryway can all make a home much more attractive to buyers.
Power-washing is a powerful, fast and fun must! Cleaning the outside of your home is almost as important as cleaning the inside. Power-washers make it fast and easy and depending on you, they can be pretty fun too. Not that most of you would need the reminder, but if you have children and depending on their age, this entire list from powerwashing and yard-work to packing, cleaning and staging are great ways to get the whole family involved, get things done faster and get better results.
A freshly painted or stained garage door captures a lot of positive attention too! A new door is expensive, but fresh paint or stain, using once again a bold colour or the perfect tone to highlight the home’s exterior is a powerful, easy and cheap way to boost curb appeal. Like many of these items, this is another great DIY task, a good way to get the kids involved or a cheap item to add to your handyhelper’s list.
Clear, clean, well-defined paths, the right balance of and selection of outdoor furniture and even new door hardware are important! Make sure you clear and ensure all pathways are well-defined and sharp looking. Consider a few solar powered lamps to help and add to the path and home’s overall visual appeal too. All outdoor furniture needs to be clean and in good condition. The right balance is key too, because too much outdoor furniture looks crowded and too little can look bare. Even a small table with a pretty planter and a few small ceramic stools, can go a long way for a garden corner or a smaller yard. Depending on the situation, new hardware can help make that front door look gorgeous.
Online advertising and the quality of your listing online is as important as it gets in today’s digital world, where everyone looks online first and foremost. Aside from leveraging as many of the best online sites and ensuring the photos, video and listing write-up are of the best possible quality, FaceBook still reigns supreme in Canadian real estate for additional online help getting attention and securing more overall viewings and visitors to your open houses.
Ask your REALTOR® if they plan on using Canvas, which is perhaps the best available tool for creative and interactive Facebook posts and ads, as well as utilizing the standard Facebook Live posting techniques & Facebook events.
USE STRATEGICALLY PLACED PHYSICAL SIGNS
Balloons attached to the normal physical signs are a great way to grab way more attention from people driving by. Drones with hanging signs have recently begun to be used to add powerful eye-catching attention, hovering above your open-house.
Don’t underestimate the power of standard physical “Open House” signs. Make sure your agent places several, helping potential buyers to easily find your house (especially if you are located off of a main road). This basic tool which is often neglected can certainly attract more potential buyers who may just be driving by and haven’t seen your house online. You never know who will decide to poke in for a quick look and decide your property is their new dream home.
INVITE THE NEIGHBOURS
Sometimes, we can all feel frustrated by nosy neighbours. However, your open house is exactly the time you want every neighbor especially the nosy ones, to be checking out your home. Invite all your neighbors to your open house. They may know of someone looking to move to the area (family, friend, or otherwise), and could end up recommending your home to them. Think of your neighbours as some of your most effective scouts and connections. Frequently, the nosy neighbor-types will be the first to tell their friends about your amazing kitchen counters, that bathroom remodel and all the best features of your property. Your realtor® can often help with letting your neighbours know about open-house dates and also consider sending your neighbor's personal invitations or fliers yourself too. Or, if you prefer, emails and personalized electronic invitations work too.
Make sure you secure your valuables (and any medication), before potential buyers start viewing your home. Thefts are rare, but they can happen. Pharmaceutical theft is one of the more common issues that can arise, so ensure your medicine cabinets are clear. Dispose of any medications you no longer need and lock up the ones that are in use (or take them with you). Also, be sure to lock up anything else that may tempt someone, such as jewelry, cash, credit cards and valuable (even if only sentimentally) knickknacks.
Your realtor® and team are there to help you sell your home, so there is no reason for you to be present during your open house. In fact, it’s highly recommended and potentially beneficial for plentiful reasons if you take off. Pack up the kids, and the pets (if you have any) and go for a drive, visit with friends/family, or head to the park. This will lessen the stress on potential buyers, and help them to feel as though they can speak freely and candidly with the agent. If you can, take your pets items with you (dishes, litter box, etc.). If not, make sure they are spotless.
PROVIDE INFORMATION PACKETS
Make sure your realtor® either leaves informational sheets for potential homebuyers to take home with them, or does careful sign-in and gathering of email information to follow up with a digital package. Buyers are almost always looking at multiple to a great many houses and having all the right information easily accessible about your home, will help them to more easily recall and consider it.
PROVIDE YUMMY TREATS
Providing delicious and/or freshly baked treats has two advantages: one, it creates an inviting, enticing aroma and the power of smell is a big deal that retailers have been using for decades, and two, your potential buyers have a delicious snack to enjoy while they tour your home, which leaves them with another set of positive impressions. Giving them a special treat, ensures potential buyers are sure to remember your property and as discussed directly below, cliché cookies work, but you can also consider contacting a local bakery or restaurant for something extraordinarily special, scrumptious and memorable.
CONSIDER A THEME OR CREATE AN EXCITING EVENT
These days, hosting an open house is about an experience. This is in part especially because of and despite the fact that prospective homebuyers often don’t have the opportunity to spend a ton of time at any given property. People want to maximum their Saturday’s and Sundays and also often plan to preview as many properties as possible.
For example—if the home happens to be designed with a regional theme, consider presenting them with similarly themed delicious treats. Also consider playing light music (e.g., bossa nova, smooth jazz or classical) which also cheers up the preview time and works to make a memorable experience.
Depending on the value of the property and your need to sell, you and your REALTOR® can also try all kinds of more unique and inviting strategies to make your open houses fun, unusual and wildly successful. You might host an open house that features a local or visiting author doing a book signing, food from two top restaurants, pop-up shopping, and more. The home could also be staged with furniture from a well-known antique/estate-sale business. Your goal is to draw people to the home and give them a reason to tour all the rooms and linger. For these stronger types of tactics you may also want to secure a media partner or two for pre- and post-event local and social coverage.
MARION GOARD’S A SEASONED PRO WHO LOVES USING OPEN HOUSES
Call 905-330-5201 or email firstname.lastname@example.org to arrange coffee or tea and your free consultation.
Wednesday, June 5, 2019
House and Home Real Estate Market Buying and Selling
We all want to be good neighbors. But when it comes to selling your home, it’s not just about “keeping up with the Joneses.” It’s about outshining them at every opportunity!
If you’re looking to sell your home fast and for the most money possible, you’ll need a strategy to set it apart from all the other listings competing for buyers in your area. In this article I’ve outlined proven, five-step plan for serious sellers.
Use these five tactics to help your listing get noticed, win over buyers, and net a higher sales price than your neighbors!
STEP 1: Stage Your Home to Show Its Full Potential
The average seller will do the minimum to prepare their home for market: clean and declutter, fix anything that’s broken, mow the lawn. And while those tasks are essential, today’s buyers want more than just a clean house and tidy yard. When they dream of buying a new home, they envision a designer house with modern finishes. Help them see your property’s full potential by staging it.
Home staging is one of the hottest trends in real estate—because it works! According to the Real Estate Staging Association, homes that are professionally staged spend 73% less time on the market.1
So what exactly is staging? In a broad sense, staging is the act of preparing your home for market. The goal is to highlight your home’s strengths, minimize any deficiencies, and help buyers envision themselves living in the space. When staging a home, you might rearrange the furniture to make a room feel larger or remove heavy curtains to make it appear brighter.
Some sellers choose to hire a professional home stager, who has specialized training and experience, to maximize the appeal of their home to the largest number of potential buyers. Others may opt to do it themselves, using guidance from their agent.
I can help you determine the appropriate budget and effort required to push your home ahead of the competition in your neighborhood. The good news is, an investment in staging pays off. A 2018 survey found that 85% of staged homes sold for 6-25% more than their unstaged neighbors homes.
STEP 2: Draw Buyers in with High-Quality Listing Photos
You only have one chance to make a first impression with potential buyers. And many buyers will view photos of a listing before they decide whether or not to visit it in person. In fact, 87% of buyers find photos “very useful” in their home search.3 Poor-quality or amateur-looking listing photos could keep buyers from ever stepping through your door.
Since good photography plays such an important role in getting your property noticed, I only work with the top local professionals to photograph our listings. At the same time I don’t just rely on their photography skills when it comes to showcasing your home.
I go the extra mile to ensure your listing photos showcase the true essence of your home. I’m always on site during the photo shoot to help the photographer capture the best angles and lighting, and to let them know about unique or compelling selling features that they should photograph. The extra effort pays off in the end. In fact, listings with high-quality photography sell 32% faster than the competition … and often for more money!
STEP 3: Price It Properly From the Start
Even in a strong real estate market, there are homes that will sit unsold for months on end. This can be the “kiss of death” in real estate, as buyers tend to imagine that there must be something wrong with the property, even if it’s not the case.
But why are those houses still on the market in the first place? It’s because they are often priced too high.
Every buyer has a budget. And most will be viewing listings within a particular price range. If your property is overpriced, it can’t properly compete with the other houses they’re viewing that are priced correctly. Which means it’ll sit on the market until you’re eventually forced to drop the price.
Alternatively, if you price your home aggressively, it can be among the nicest homes that buyers have seen within their budget. This can lead to emotionally-attached buyers, who are often willing to pay a premium or settle for fewer seller concessions. And in certain markets, it can lead to a multiple-offer situation, or bidding war. The end result? More money in your pocket.
We can help you determine the ideal listing price for your home in the current market. Pricing it properly in the beginning is the best way to ensure a fast and profitable sale.
STEP 4: Put on a Good Show at Each Showing
Once buyers are interested enough to schedule a visit, it’s crucial that you put on a good show at each showing.
The first step is to make your home readily available—and often on short notice—for buyers to see it. A missed showing is a missed opportunity to sell your home. If you set too many restrictions on when it’s available to view, busy buyers will simply skip over your listing and move on to the next one.
Part of making your home available means keeping it relatively show-ready as long as it’s on the market. Most of us don’t live picture-perfect lives, and our homes reflect the day-to-day reality of our busy (and sometimes messy) families. But a little extra effort spent keeping your home clean, fresh-smelling, and ready for buyers will help it sell faster … which means you can get back to your regular routine as quickly as possible!
STEP 5: Use a Proven Promotion Plan
Many agents are still marketing their listings like they did 20 years ago … put a sign in the yard, put the listing in the MLS, and pray that it sells. Yet, we know that 93% of buyers search for real estate listings online.3
That’s why I continually invest in the latest training and technology—to ensure your listing appears in the places where buyers are most likely to look. My dual-level promotion strategy includes both pre-launch activities designed to seed the marketplace and post-listing activities to ensure your home stays top-of-mind with potential buyers.
By utilizing online and social marketing platforms to connect with consumers and offline channels to connect with local real estate agents, your property gets maximum exposure to prospective buyers.
LET’S GET MOVING
Are you thinking about listing your home? Get a head start on your competition! Contact me for a copy of my Seller’s Guide, which offers a complete guide to today’s home selling process. Or call me to schedule a free no-commitment consultation. I’d love to put together a custom plan to maximize the sales potential of your property!
Thursday, January 3, 2019
House and Home Real Estate Market Buying and Selling
As we begin another year, everyone wants to know: “Where is the housing market headed in 2019?”
The Canadian real estate market experienced a cool-down in 2018 following years of rapid growth. This left many homeowners and potential buyers feeling skittish. Fortunately, economists expect the market to stabilize in 2019 and continue to appreciate at a more sustainable rate. To help guide you through this shifting landscape, below are some of the expert predictions and key factors expected to shape the housing market in 2019 and beyond.
SALES LEVELS WILL STABILIZE
A combination of rising interest rates, provincial policy changes, and a newly-implemented “stress test” requirement for mortgages pushed sales activity to a five-year low in 2018. However, economists expect the impact to taper off over time due to positive economic fundamentals: a strong economy, low unemployment, rising incomes, and rapid population growth.
“Far from a sign of trouble, we view this cooling as a healthy correction that would prevent overheating conditions from re-emerging in parts of Canada such as the Vancouver and Toronto areas. We expect a modest recovery to take shape in 2019,” noted the Royal Bank of Canada in its Canadian Housing Market Forecast. “We see little risk of a downward spiral because demand and supply conditions are balanced in the majority of local markets and expected to remain so over the forecast horizon.”1
What does it mean for you? If you’ve been scared off by reports of a market slowdown, it’s important to keep things in perspective. Policy changes were put in place to cool down an overheated market that had led to increased debt levels, decreased affordability, and historically-low inventory levels. A gradual and sustainable pace of growth is preferable for long-term economic stability.
PRICES WILL HOLD STEADY
Economists expect prices to hold steady this year, rising slightly to keep pace with inflation. While the national average price declined by 4.2 percent in 2018, the Canadian Real Estate Association predicts it will rebound slightly this year by 1.7 percent.2
The Canada Mortgage and Housing Corporation also expects prices to remain high, but stable. “By 2020, demand is expected to continue to shift towards relatively less expensive housing options such as apartment condominiums. This combined with slowing growth in economic conditions will lead to modest average price growth over the forecast horizon.”3
The Royal Bank of Canada agrees, cautioning that “would-be buyers hoping for a meaningful [price] break will likely be disappointed—we don’t expect aggregate prices to fall on an annual basis either this year or next.”1
What does it mean for you? If you’re a buyer waiting on the sidelines for prices to drop, you may want to reconsider. The current sales slowdown has made many sellers more willing to negotiate. Don’t miss out on the most favourable market we’ve seen for buyers in years.
NEW CONSTRUCTION WILL SLOW
The Canada Mortgage and Housing Corporation predicts new home construction will trend down over the next two years from a 10-year high in 2017. “Single-detached housing starts are anticipated to decrease over the forecast horizon. Construction of this housing type will continue to be limited by residential lot availability, but also by elevated price and borrowing costs in some major CMAs that represent an important portion of national starts.”3
However, economists expect the decline to be gradual. According to Fotios Raptis, a senior economist at TD Bank, “a steep downturn in homebuilding nationwide appears unlikely. Canada's population is on the rise, medium-term income growth should remain healthy, and most markets are generally not overbuilt.”4
What does it mean for you? Buyers will continue to have options in new construction. But the decreased rate of supply should help prop up the resale market, which is good news for sellers.
INTEREST RATE HIKES WILL TAKE A BREATHER … FOR NOW
After a series of interest rate hikes, the Bank of Canada announced in December that it will likely slow its pace of rate increases. “We no longer expect the Bank of Canada to hike its policy interest rate in January. Spring 2019 now appears to be the more likely timing, allowing for the bank to ensure that the growth narrative is back on track,” commented Brian DePratto, a senior economist with TD Bank.5
At the same time, the impact of the mortgage stress test has slowed the pace of new mortgages being issued by traditional lenders. So even as funding costs have risen, banks have been hesitant to raise the 5-year qualifying rate. In its latest Mortgage Rate Forecast, the British Columbia Real Estate Association predicts that the 5-year mortgage rate will hold steady this year—and may even decline in the first quarter.6
What does it mean for you? If you currently have a variable rate mortgage, the bank’s revised policy should offer some welcome relief. And if you thought rising interest rates would prevent you from buying a home this year, you may be pleasantly surprised.
I’M HERE TO GUIDE YOU
While national real estate numbers and predictions can provide a “big picture” outlook for the year, real estate is local. And as a local market expert, I can guide you through the ins and outs of our market and the local issues that are likely to drive home sales and values in your particular neighbourhood.
If you have specific questions or would like more information about where real estate is headed in our market, let me know! I’m here to help you navigate this changing real estate landscape.
START PREPARING TODAY
If you plan to BUY this year:
- Get pre-approved for a mortgage. If you plan to finance part of your home purchase, getting pre-approved for a mortgage will give you a jump-start on the paperwork and provide you with more confindence in a competitive market. The added bonus: you will find out how much you can afford to borrow and budget accordingly.
- Create your wish list. How many bedrooms and bathrooms do you need? How far are you willing to commute to work? What’s most important to you in a home? I can set up a customized search that meets your criteria to help you find the perfect home for you.
- Come to our office. The buying process can be tricky. I’d love to guide you through it. I can help you find a home that fits your needs and budget, all at no cost to you. Give me a call to schedule an appointment today!
If you plan to SELL this year:
- Call for a FREE Comparative Market Analysis. A CMA not only gives you the current market value of your home, it will also show how your home compares to others in the area. This will help us determine which repairs and upgrades may be required to get top dollar for your property, and it will help us price your home correctly once you’re ready to list.
- Prep your home for the market. Most buyers want a home they can move into right away, without having to make extensive repairs and upgrades. I can help you determine which ones are worth the time and expense to deliver maximum results.
- Start decluttering. Help your buyers see themselves in your home by packing up personal items and things you don’t use regularly and storing them in an attic or storage locker. This will make your home appear larger, make it easier to stage ... and get you one step closer to moving when the time comes!
- RBC Canadian Housing Market Forecast –
- CREA Resale Housing Market Forecast Update –
- Canada Mortgage and Housing Corporation Housing Market Outlook –
- TD Economics –
- TD Economics –
- BCREA Mortgage – http://www.bcrea.bc.ca/docs/economics-forecasts-and-presentations/mortgagerateforecast.pdfRate Forecast