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The Canadian Real Estate Market started off well at the beginning of 2018 contrary to what many skeptics had predicted. That prediction came about due to the continued drop in housing prices a year-over-year basis, leaving a number of economists with doubts regarding the stability of the market.
In fact, a group of economics in Canada predicted that the real estate market was likely to get adjusted to the regulatory changes expected some months to come. While this observation was true in some areas, regions such as Ontario stood the test of time all along and the estate market in places such as Barrie City and others shows significant improvement in the housing prices.
As such, property investors have not downed their tools but still work hard to meet the rising demand for homes. Check out here: https://www.homeads.ca/barrie-real-estate to have a glimpse of different homes in Barrie City in order to have a clear picture of the thriving real estate market in this region.
In Ottawa, the housing market is showing a tremendous improvement after an extended period of the stumble at the beginning of the year. As such, this new development has shaken off the impact created by the stricter mortgage rules, high-interest rates as well as provincial policy changes.
According to the Canadian Real Estate Association (CREA), homes sales showed a significant increase of 1.9% in the month of July in comparison to June. The increase in home prices marked the third month of recovery since the prices plunged at the onset some years back.
Price stabilization in the Greater Toronto Area (GTA) has been affected greatly by the pullback in other cities especially those in Western Canada. However, the sales increased by 7.7% in June and 17.6% year-over-year to lead the July housing price increase. At the same time, more than half of local housing markets recorded more sales in July than what was recorded in June.
When compared with one year ago, the overall sales in the month of July this year were 1.3% as a result of fewer transactions taking place in major urban areas within British Columbia. The figure indicated the leveling off of the much steeper year-over-year slowdown at the beginning of 2018.
According to the analysts, the undersupply of new houses and the growing demand of home buyers amidst the history of lower unemployment as well as a stable economy were the main contributors in keeping the year-over-year housing prices steady.
Quebec has been perceived as the most active real estate market on the vast island of Montreal. This is according to Saint-Pierre, a senior director of the Royal LePage’s Quebec area. He is of the opinion that the housing market is doing well and it is moving towards a more balanced market.
Unlike this year, the area was perceived to be more of the buyer’s market a few years back. Saint-Pierre further states that Montreal was the only province that experienced a drastic drop in its inventory in the previous year but it is expected that the prices will rise any time soon.
Elsewhere in Canada, there has been stability in housing prices with a slight decrease as the mortgage rates and high interests exert immense pressure on the real estate market across the country. In Calgary, prices have gone down by 2.6% while in Gatineau the prices have declined by 2.1% on the average since the past few years.
The situation is different in Alberta where investors are rushing back to have a share of the real estate market thanks to the booming economy from the sale of oil. The city’s economy relies heavily on oil and an increase in the global oil-price seems to bring back Albert to life as more opportunities arise.
What is to come?
Given that the Canadian slow employment growth was realized two years back, experts still don’t believe that the house prices will get stronger beginning this year. Their forecast, however, is placed at an average rise of about 3%.
The long prediction shows that in the coming ten years or so, given the prevailing state of the market, there will be a steady rise in the interest rates. The increase in the interest rate will have some impact on the housing affordability in Canada and when inflation is subtracted, there will be no significant gains made in general.
The first-time home buyers are likely to face some difficulties when that time comes. This comes about as a result of Canada’s overvaluation of homes in various cities and regions such as Toronto and most of the Western Canadian cities. In the long run, young families will be compelled to relocate to the suburbs or choose to buy condos in the cities.
For those who would wish to build their wealth by investing in real estate market, they are advised to focus on the emerging neighborhoods where they can buy land in areas showing signs of developing in the future.
Apparently, no one is fully aware of when things might start to heat up once more. But some real estate market experts seem to have an idea as to why everything pertaining to the progress of the Canadian real estate market is taking too long.
Generally, the real estate market in Canada is poised to a rebound after a few years of the slowdown in the housing prices. Even though the rising interest rates and the stringent mortgage rules are to blame for the prevailing market conditions, the future looks promising for the property investors in the country.
That is why it is projected that with the stable economy and an increasing growth in population, the housing prices are likely to stabilize in the near future or better still, place the real estate market to the position it was a few years back.
The demand for homes will always be higher as long as there is an influx of people moving to certain cities to work and settle there. Also, the improving housing prices will attract scores of real estate investors and in the long run, the real estate market in Canada will get back to where it was and of course stay afloat for many years to come.