Toronto, ON and Kelowna, BC, September 28, 2022 – RE/MAX brokers and agents are anticipating the national average residential sale price in the Canadian housing market to decline 2.2 per cent in the final months of the year (September-December), according to RE/MAX’s 2022 Fall Canadian Housing Market Outlook Report. This market moderation comes on the heels of rising interest rates, record-high inflation and broader global and economic uncertainties that have impacted consumer confidence and market activity. Bucking the downward trend, seven out of 30 Canadian housing markets analyzed are likely to experience modest price appreciation between 1.5 and seven per cent. Meanwhile, RE/MAX brokers and agents expect a decline in sales this fall, in 18 out of 30 markets surveyed.
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In a survey of RE/MAX brokers and agents, 25 out of 30 said rising interest rates have affected activity in their local residential market this year, with some indicating that this has been the biggest factor impacting homebuyer and seller confidence – a trend that is likely to continue for the remainder of 2022. These insights are supported by a new Leger survey commissioned by RE/MAX Canada, which reveals that 44 per cent of Canadians agree that rising interest rates are compelling them to hold on buying a property this fall, while 34 per cent say they won’t hold.
“While we are still facing significant housing supply shortages across the Canadian housing market, many regions are experiencing softer sales activity given recent interest rate hikes. This provides some reprieve from the unprecedented demand and unsustainable price increases we’ve seen across Canada through 2021 and in early 2022,” says Christopher Alexander, President at RE/MAX Canada. “However, the current lull in the market is only temporary. Until housing supply increases, these ‘boom’ and ‘bust’ cycles will likely be a recurring event.”
“Despite the fact that nearly half of Canadians are waiting to buy or sell a home, we’re confident that as economic conditions improve by mid-2023, activity will resume,” says Elton Ash, Executive Vice President, RE/MAX Canada. “Timing the market for short-term investment is extremely difficult and rarely successful. But as a long-term investment, the Canadian housing market continues to yield solid returns. If someone needs to buy or sell, regardless of those cyclical peaks and valleys, being informed and working with an experienced real estate professional can help consumers clarify some of those unknowns and make the best decision possible.”
Regional Canadian Housing Market TrendsRE/MAX brokers and agents in Canada were asked to provide an analysis of their local market this fall and share their estimated outlook for the remaining months of 2022 (September-December).
Western Canada and the PrairiesIn regions such as Vancouver, BC, Victoria, BC, Kelowna, BC, and Edmonton, AB, RE/MAX brokers reported rising interest rates as a factor impacting local market activity, resulting in softening consumer confidence, fewer multiple offers from buyers, and a shift toward more balanced conditions between buyers and sellers. In all regions analyzed in Western Canada and the Prairies, with the exception of Calgary, AB and Edmonton, AB, the average residential sale price is expected to decline between zero and 6.5 per cent.
In Calgary, AB, interest rate hikes and recession worries have not had a notable effect on the market, due to the region’s relative affordability. As such, a modest three-per-cent price increase is expected through the remainder of the year. In Edmonton, AB, rising interest rates have had the greatest impact on homes priced from $500,000 to $1,000,000, while those priced at $400,000 or less are still relatively affordable and a good entry point into the market, despite the current economic climate. Edmonton is likely to experience a modest price increase of 1.5 per cent for the remainder of the year. In both Vancouver, BC and Edmonton, AB, demand for luxury properties has remained stable, with interest rate hikes having a minimal impact on this segment of the market. This is expected to continue into the fall months. Low inventory remains a pressing concern in Kelowna, BC, Victoria, BC, Vancouver, BC and Calgary, AB, and is expected to place upward pressure on home prices in 2023 and beyond. In contrast, recent commercial and industrial developments have eased inventory concerns in Winnipeg, MB for the time being.
OntarioMuch like other provinces across the country, Ontario has not been immune to the impacts of rising interest rates. Many markets including Oakville, Windsor, Barrie, Durham, Kingston and Kitchener-Waterloo, anticipate – and in some cases already experiencing – a reduction in the number of units sold over the coming months. Apart from Oakville and Muskoka, average residential sale prices in Ontario are likely to remain steady or decrease between two to 10 per cent in the fall months.
Similar to Western Canada, the luxury market has remained resilient and in-demand among buyers in Oakville, despite rising interest rates and a looming recession – a contributing factor to the modest two-per-cent average residential sale price increase expected in Oakville this fall. Muskoka continues to attract homebuyers to the area, while simultaneously, many sellers are eager to sell before year-end. Given a steady stream of demand, Muskoka is expected to experience a modest five-per-cent increase in average residential sale price this fall. In Peterborough, interest rate hikes and the subsequent effects on the stress test have eroded affordability in the area, which is the main factor contributing to the seven-per-cent decrease in average residential sale price expected in the coming months. The return of conditional offers has been a prevalent trend across the province, including in Kingston, Kitchener-Waterloo, Muskoka and Peterborough. Echoing many regions across Canada, Durham, London, Sudbury, Ottawa, the Lakelands and the Greater Toronto housing market are expected to regain balance in 2023, albeit with low inventory continuing to place upward pressure on prices. As one of the more affordable markets in Ontario, Thunder Bay is unlikely to experience any significant fluctuations in average residential sale prices this fall.
Atlantic Canada*Similar to Western Canada and Ontario, economic factors such as rising interest rates and a possible recession have contributed to decelerated home-buying activity in the region. Charlottetown, PEI experienced immediate impacts as interest rates rose, with the number of sale transactions reduced by almost half on a month-over-month basis, particularly among properties in the $500,000 to $1,000,000 price range. Despite these circumstances, Atlantic Canada continues to attract out-of-province buyers due to its affordability, relative to the rest of Canada. The majority of Atlantic Canada housing markets analyzed are expected to experience modest price increases through the end of 2022, including Halifax, NS (+1.5%), Moncton, NB (+6%) and St. John’s, NL (+7%). The outlier is Charlottetown, PEI, where average residential sale price is expected to decline by two per cent in the fall months.
Housing affordability continues to attract buyers in Moncton, who have been able to leverage the recent decrease in demand to negotiate with sellers and include conditions on purchases. Meanwhile in St. John’s, NL, economic pressure from rising interest rates has resulted in extended rent periods by would-be buyers, despite this region anticipating an increase of seven per cent in average residential sale prices. The trend has been further exacerbated by low housing inventory. However, recent “green” government announcements and initiatives are anticipated to boost the local economy and in tandem, the housing market. In spite of concerns over supply falling short of demand, Charlottetown, PEI is expected to regain more balance in 2023. However, inflation coupled with the increased cost of living will likely result in a moderate two-per-cent decline in average residential sale prices through the end of 2022.
About the 2022 RE/MAX Canada Fall Outlook Report
The 2022 RE/MAX Canada Fall Outlook Report includes data and insights from RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments. Average sale price is reflective of all property types in a region and varies depending on the region. When referring to “fall” this includes the months of September 2022-December 2022. *Insights/figures in Atlantic Canada were gathered prior to Hurricane Fiona. Regional summaries with additional broker insights can be found at the RE/MAX Canada blog.
About Leger Leger is the largest Canadian-owned full-service market research firm. An online survey of 1,522 Canadians was completed between September 16 and 18, 2022, using Leger’s online panel. Leger’s online panel has approximately 400,000 members nationally and has a retention rate of 90 per cent. A probability sample of the same size would yield a margin of error of +/- 2.5 per cent, 19 times out of 20.
About the RE/MAX Network As one of the leading global real estate franchisors, RE/MAX, LLC is a subsidiary of RE/MAX Holdings (NYSE: RMAX) with more than 140,000 agents in almost 9,000 offices with a presence in more than 110 countries and territories. RE/MAX Canada refers to RE/MAX of Western Canada (1998), LLC and RE/MAX Ontario-Atlantic Canada, Inc., and RE/MAX Promotions, Inc., each of which are affiliates of RE/MAX, LLC. Nobody in the world sells more real estate than RE/MAX, as measured by residential transaction sides.
RE/MAX was founded in 1973 by Dave and Gail Liniger, with an innovative, entrepreneurial culture affording its agents and franchisees the flexibility to operate their businesses with great independence. RE/MAX agents have lived, worked and served in their local communities for decades, raising millions of dollars every year for Children’s Miracle Network Hospitals® and other charities. To learn more about RE/MAX, to search home listings or find an agent in your community, please visit remax.ca. For the latest news from RE/MAX Canada, please visit blog.remax.ca.
Forward looking statements This report includes “forward-looking statements” within the meaning of the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “believe,” “intend,” “expect,” “estimate,” “plan,” “outlook,” “project,” and other similar words and expressions that predict or indicate future events or trends that are not statements of historical matters. These forward-looking statements include statements regarding housing market conditions and the Company’s results of operations, performance and growth. Forward-looking statements should not be read as guarantees of future performance or results. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These risks and uncertainties include (1) the global COVID-19 pandemic, which has impacted the Company and continues to pose significant and widespread risks to the Company’s business, the Company’s ability to successfully close the anticipated reacquisition and to integrate the reacquired regions into its business, (3) changes in the real estate market or interest rates and availability of financing, (4) changes in business and economic activity in general, (5) the Company’s ability to attract and retain quality franchisees, (6) the Company’s franchisees’ ability to recruit and retain real estate agents and mortgage loan originators, (7) changes in laws and regulations, (8) the Company’s ability to enhance, market, and protect the RE/MAX and Motto Mortgage brands, (9) the Company’s ability to implement its technology initiatives, and (10) fluctuations in foreign currency exchange rates, and those risks and uncertainties described in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) and similar disclosures in subsequent periodic and current reports filed with the SEC, which are available on the investor relations page of the Company’s website at www.remax.com and on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made. Except as required by law, the Company does not intend, and undertakes no duty, to update this information to reflect future events or circumstances.
PAST CANADIAN HOUSING MARKET OUTLOOKS & REPORT ARCHIVES #accordion-24200-1 .fusion-panel:hover{ border-color: #e0dede } #accordion-24200-1 .fusion-panel { border-color:#e0dede; }.fusion-accordian #accordion-24200-1 .panel-title a .fa-fusion-box{ color: #ffffff;}.fusion-accordian #accordion-24200-1 .panel-title a .fa-fusion-box:before{ font-size: 13px; width: 13px;}.fusion-accordian #accordion-24200-1 .panel-title a{color:#00458b;font-family:"Roboto";font-weight:regular;}.fusion-accordian #accordion-24200-1 .toggle-content{font-size:15px;color:#747474;font-family:"Roboto";font-weight:regular;}.fusion-accordian #accordion-24200-1 .fa-fusion-box { background-color: #004e9b;border-color: #004e9b;}.fusion-accordian #accordion-24200-1 .panel-title a:not(.active):hover, #accordion-24200-1 .fusion-toggle-boxed-mode:hover .panel-title a { color: #03a9f4;}.fusion-accordian #accordion-24200-1 .panel-title .active .fa-fusion-box,.fusion-accordian #accordion-24200-1 .panel-title a:not(.active):hover .fa-fusion-box { background-color: #03a9f4!important;border-color: #03a9f4!important;}.fusion-accordian #accordion-24200-1 .panel-5ea15d596be581a1b .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-5ea15d596be581a1b .toggle-content{color:#747474;}RE/MAX 2022 HOUSING MARKET OUTLOOK Confidence continues in Canadian housing market, with the inter-provincial relocation trend likely to remain strong in 2022 Migration between provinces expected to continue in 2022, potentially impacting local Canadian real estate conditions, according to 53 per cent of RE/MAX brokers (20 out of 38) 49 per cent of Canadians believe the housing market will remain steady in 2022 and view real estate as one of the best investment options over the next year Some of the highest outlooks are anticipated for Atlantic Canada, with Moncton and Halifax projecting average residential sales prices to increase by 20 per cent and 16 per cent respectively in 2022 97 per cent of regions (37 out of 38) surveyed are likely to remain seller’s markets in 2022Toronto, ON and Kelowna, BC, December 1, 2021 – RE/MAX is anticipating steady price growth across the Canadian real estate market in 2022, with inter-provincial migration continuing to be a key driver of housing activity in many regions, based on surveys of RE/MAX brokers and agents, as reflected in the 2022 Canadian Housing Market Outlook Report. The ongoing housing supply shortage is likely to continue, putting upward pressure on prices. As a result of these factors, RE/MAX Canada estimates a 9.2-per-cent increase in average residential sales prices across the country*.
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“Based on feedback from our brokers and agents, the inter-provincial relocation trend that we began to see in the summer of 2020 still remains very strong and is expected to continue into 2022,” says Christopher Alexander, President, RE/MAX Canada. “Less-dense cities and neighbourhoods offer buyers the prospect of greater affordability, along with liveability factors such as more space. In order for these regions to retain these appealing qualities and their relative market balance, housing supply needs to be added. Without more homes and in the face of rising demand, there’s potential for conditions in these regions to shift further.”
Despite the global pandemic, many Canadians still feel confident in the real estate market. According to a Leger survey conducted on behalf of RE/MAX Canada, 49 per cent of respondents believe Canadian real estate will remain one of their best investment options in 2022 (59 per cent of homeowners vs. 34 per cent non-homeowners which included renters, those not looking buy, and those currently looking to purchase). Additionally, 49 per cent of respondents are confident the Canadian real estate market will remain steady next year.
“Canadians recognize the value and investment potential in their homes. However, market challenges such as rising prices and limited supply have impacted local markets from coast-to-coast, causing angst this past year among those looking to get into the market and those hoping to move up in it,” says Elton Ash, Executive Vice President, RE/MAX Canada. “Despite this, it’s encouraging to see that many are feeling confident in the housing market in 2022 and view Canadian real estate as a solid investment.”
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2022 Regional Canadian Real Estate Insights
RE/MAX brokers and agents in Canada were asked to provide an analysis of their local market in 2021 and share their estimated outlook for 2022. Based on their insights, 97 per cent of Canadian real estate markets are expected to favour sellers, impacted by limited housing supply and high demand.
WESTERN CANADA
The Calgary and Edmonton markets shifted from balanced conditions in 2020 to seller’s markets in 2021, which brokers and agents in the region expect to continue into 2022. This is attributed to heightened demand prompted by the inter-provincial migration trend that took place throughout 2021, which saw many homebuyers from Ontario and British Columbia driving demand high, while supply remained low.
In addition to an increase in out-of-province buyers flocking to Edmonton, the region has also welcomed investors who found themselves priced out of other markets. RBC’s provincial outlook for Alberta puts this province ahead of all others in terms of economic growth in 2022, which should bode well for homebuyers and investors alike 2022.
Regions such as Victoria, Nanaimo, Regina and Kelowna also experienced an influx of buyers in search of larger properties and greater affordability, which is likely to continue pushing demand and prices up in 2022. This trend has notably increased demand for single-family detached homes and in some regions, condos as well, which may continue in 2022.
Despite some buyers choosing to move away from urban centres such as Vancouver/Greater Vancouver in favour of suburban areas within British Columbia, or leaving the province entirely, Vancouver/Greater Vancouver has remained a quality place to live. The region continues to draw interest from Canadian and international buyers, a trend that is likely to grow next year, in tandem with rising immigration. Vancouver/Greater Vancouver is expected to remain a seller’s market in 2022, providing inventory stays tight and current demand continues, according to a RE/MAX broker in Greater Vancouver Area.
Winnipeg is anticipated to continue to be a seller’s market in 2022. Young couples enjoying the freedom to work from home have been driving much of the demand in the region, especially for one- and two-story detached homes. The appeal of Winnipeg has had less to do with affordability, and more with lifestyle shifts such as hybrid working environments.
ONTARIO
According to the RE/MAX broker network in Ontario, market activity across the province is anticipated to remain steady in 2022, with continued average price growth, although at widely varying degrees. RE/MAX brokers anticipate average sale price increases in smaller markets such as North Bay (four per cent); Sudbury (five per cent); Thunder Bay (10 per cent); Collingwood/Georgian Bay (10 per cent); and Muskoka (20 per cent), where the move-over trend has remained strong. Meanwhile, in larger markets within the province, there’s a possibility that more immigration could weigh on supply levels and prices, including Ottawa (five per cent); Durham (seven per cent); Brampton (eight per cent); Toronto (10 per cent); Mississauga (14 per cent).
When it comes to price appreciation year-over-year, there are a few regions that stood out in 2021 for their exponential increases across all property types, including Brampton, which rose from $869,107 in 2020 to $1,085,417 in 2021 (25 per cent); Durham from $706,818 in 2020 to $914,48 in 2021 (29 per cent); and London from $487,500 in 2020 to $633,700 in 2021 (30 per cent). In comparison, Toronto experienced a modest seven-per-cent increase year-over-year ($986,085 in 2020 to $1,054,922 in 2021).
ATLANTIC CANADA
All of Atlantic Canada’s regions analyzed are currently seller’s markets, with potential for average sale prices to increase between five to 20 per cent in 2022, according to RE/MAX brokers and agents. Larger urban centres including Moncton, Fredericton, Saint John, Halifax, Charlottetown and St. John’s have all experienced an influx of out-of-province buyers, especially from Ontario, moving to the region in search of greater affordability and liveability.
Due to this spike in demand, much of the region has experienced increasing competition, especially among single-family detached homes and condos in some cities. There’s a possibility that this may further be amplified as immigration continues to grow in the region.
According to RE/MAX brokers and agents in the region, new construction is anticipated to remain strong into 2022, although construction activity may be dampened by ongoing supply shortages and delays in permits related to the pandemic backlog.
Seller’s market conditions are expected to prevail across the region in 2022, with the exception of Charlottetown and Southern Nova Scotia, which may return more to a balanced state as activity gradually begins to decrease.
These factors have led to some of the highest price outlooks in the country, with Halifax and Moncton projecting estimated average residential sales price to increase by 16, and 20 per cent respectively.
Additional findings from the 2022 Canadian Housing Market Outlook Report
Two-in-five Canadians trust their agent to advise them during the current real estate landscape (43 per cent)
23 per cent of Canadians now have a greater desire to build their own home or buy pre-construction
26 per cent of Canadians have the desire to purchase a home while mortgage rates remain low
62 per cent of Canadians currently own a home. This is higher among those ages 35+ (70 per cent) compared with Millennials, ages 18-34 (42 per cent)
The majority of Canadians (72 per cent) said rising home prices did not impact their purchasing decisions in 2021.
About the 2022 Housing Market Outlook Report
The 2022 RE/MAX Housing Market Outlook Report includes data and insights from RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments. Regional summaries with additional broker insights can be found at REMAX.ca. The overall outlook is based on the average of all regions surveyed, weighted by the number of transaction in each region.
*2020 average residential sale price numbers were full-year, 2021 were from January 2021 – October 31, 2022.
About Leger Leger is the largest Canadian-owned full-service market research firm. An online survey of 1,554 Canadians was completed between October 29-31, 2021 using Leger’s online panel. Leger’s online panel has approximately 400,000 members nationally and has a retention rate of 90 per cent. A probability sample of the same size would yield a margin of error of +/- 2.5 per cent, 19 times out of 20.
About the RE/MAX Network As one of the leading global real estate franchisors, RE/MAX, LLC is a subsidiary of RE/MAX Holdings (NYSE: RMAX) with more than 140,000 agents in over 8,600 offices across more than 110 countries and territories. Nobody in the world sells more real estate than RE/MAX, as measured by residential transaction sides. RE/MAX was founded in 1973 by Dave and Gail Liniger, with an innovative, entrepreneurial culture affording its agents and franchisees the flexibility to operate their businesses with great independence. RE/MAX agents have lived, worked and served in their local communities for decades, raising millions of dollars every year for Children’s Miracle Network Hospitals® and other charities. To learn more about RE/MAX, to search home listings or find an agent in your community, please visit remax.ca. For the latest news from RE/MAX Canada, please visit blog.remax.ca.
Forward looking statements This report includes “forward-looking statements” within the meaning of the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “believe,” “intend,” “expect,” “estimate,” “plan,” “outlook,” “project,” and other similar words and expressions that predict or indicate future events or trends that are not statements of historical matters. These forward-looking statements include statements regarding housing market conditions and the Company’s results of operations, performance and growth. Forward-looking statements should not be read as guarantees of future performance or results. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These risks and uncertainties include (1) the global COVID-19 pandemic, which has impacted the Company and continues to pose significant and widespread risks to the Company’s business, the Company’s ability to successfully close the anticipated reacquisition and to integrate the reacquired regions into its business, (3) changes in the real estate market or interest rates and availability of financing, (4) changes in business and economic activity in general, (5) the Company’s ability to attract and retain quality franchisees, (6) the Company’s franchisees’ ability to recruit and retain real estate agents and mortgage loan originators, (7) changes in laws and regulations, (8) the Company’s ability to enhance, market, and protect the RE/MAX and Motto Mortgage brands, (9) the Company’s ability to implement its technology initiatives, and (10) fluctuations in foreign currency exchange rates, and those risks and uncertainties described in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (“SEC”) and similar disclosures in subsequent periodic and current reports filed with the SEC, which are available on the investor relations page of the Company’s website at www.remax.com and on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made. Except as required by law, the Company does not intend, and undertakes no duty, to update this information to reflect future events or circumstances.
.fusion-accordian #accordion-24200-1 .panel-38a43bfdfd26acd6a .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-38a43bfdfd26acd6a .toggle-content{color:#747474;}RE/MAX 2021 FALL HOUSING MARKET REPORT Canadian housing market expected to remain strong this fall, despite Delta variant, say RE/MAX brokers and realtors Young families driving demand for single-detached homes in cities across the country Canadian housing market prices are anticipated to increase by 5% in the remaining months of 2021, according to RE/MAX brokers and agents. 27/30 major Canadian housing markets analyzed are seller’s markets, driven by lack of supply and high demand.Toronto, ON and Kelowna, BC, October 5, 2021 – Early indicators from RE/MAX brokers and agents across the Canadian housing market suggest steady activity for the remainder of 2021. According to the RE/MAX Canada 2021 Fall Housing Market Outlook Report, RE/MAX brokers and agents expect the average residential sale price for all home types could increase by five per cent from now until the end of the year.
Single-detached homes experienced the biggest price gains when comparing 2021* to 2020 data, rising between 6.8 and 27.3 per cent across 27 markets surveyed in the report. RE/MAX brokers and agents expect this trend to continue into the fall, driven by strong demand by young families.
“As our brokers and agents predict, the fall market activity is expected to remain steady, which is promising, despite the ongoing challenges presented by the Delta variant,” says Christopher Alexander, Senior Vice President, RE/MAX Canada. “This is particularly relevant given the Canadian housing markets is often a good indicator of economic activity in the country, and with the Bank of Canada forecasting economic growth of 4.5 per cent in 2022, a strong fall housing market is a good sign that things may be starting to return to a more natural rhythm.”
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Regional Canadian Housing Market Overview
WESTERN CANADA
High housing prices, driven up by low supply and high demand, have created challenging conditions for many homebuyers across Canada, especially in cities such as Toronto and Vancouver. However, affordable options still exist for homebuyers who are considering alternative markets, thanks to their continued ability to work remotely. RE/MAX brokers have reported this trend in Edmonton and Calgary, where buyers are leveraging increased purchasing power thanks to local housing affordability coupled with lower interest rates. RE/MAX brokers and agents anticipate this trend to continue through the remainder of 2021.
When comparing activity year-over-year (YoY) average sale prices across single-detached homes, condos and townhomes, British Columbia’s Nanaimo, Victoria and Vancouver experienced significant price growth, at 23 per cent, 19.1 per cent and 16.4 per cent, respectively. Nanaimo also saw one of the largest price surges in its condo and townhome segments when compared to other Western Canada regions, with average condo prices currently sitting at $343,713 (a 17.6-per-cent increase YoY), and townhomes at $492,536 (a 21.9-per-cent increase YoY). In Calgary and Regina, the fall outlooks are relatively status quo, with prices expected to remain flat in Calgary and up one per cent in Regina. Meanwhile, Edmonton, Saskatoon, Vancouver, Victoria, Winnipeg and Nanaimo are expected to see price gains ranging between four and nine per cent through the remainder of the year, according to RE/MAX brokers and agents.
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ONTARIOUnsurprisingly, Ontario has seen some of the highest average residential price increases across single-detached homes in the country, with the majority of regions (13 out of 16), experiencing increases between 20 and 35.5 per cent YoY. The outlier markets that experienced price increases below 20 per cent include Toronto (+14.6 per cent), Thunder Bay (+17.1 per cent) and Mississauga (+19.7 per cent).
The condo and townhome segment in all of these regions has also performed well, with smaller and more suburban markets such as Kitchener, North Bay, London, Peterborough, and Southern Georgian Bay seeing a higher surge YoY. The estimated price outlook for the remainder of the year ranges from a two-per-cent price decrease in North Bay, to increases across the other regions ranging between two and 15 per cent.
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ATLANTIC CANADAHousing market activity in Atlantic Canada remained persistent YoY, with Halifax and Moncton seeing significant price increases across all property types. Single-detached homes in Halifax rose 24.3 per cent YoY, from $402,484 to $500,147. Meanwhile, Moncton detached prices gained 21.2 per cent YoY, from $233,676 to $282,886. The condo and townhome segments in Halifax, Saint John and Moncton all saw prices surge between 12.5 per cent and 48.9 per cent YoY.
Housing prices in St. John’s, NFLD were more tempered, with single-detached homes rising 8.4 per cent YoY (from $343,070 in 2020 to $371,970 in 2021) and townhomes experiencing a 2.8-per-cent increase, from $247,432 in 2020 to $254,462 in 2021. Condominiums were the only property segment to see a decline in average price, down 1.9 per cent YoY, from $261,425 in 2020 to $256,415 in 2021. However, sales in the region have been brisk across all property types, with detached-home sales up 60.4 per cent YoY, condominium sales up 75.7 per cent, and townhome sales up 94.1 per cent.
Moncton in particular is expected to continue strong, with one of the highest price outlooks for the remainder of 2021, between 12 and 15 per cent. Saint John is expected to see more-tempered price growth, ranging between one- to three-per-cent across all property types, while Halifax could see a six-per-cent increase in average sale price for the remainder of the year. In St. John’s, detached home prices are expected to rise one per cent through the remainder of 2021, while condo and townhome prices should hold steady.
“Housing activity throughout the pandemic has remained strong, so it comes as no surprise that the outlook for the remainder of the year continues on an upward trajectory, which is great for homeowners and their equity, but challenging for first-time buyers who have been priced out of the market,” says Elton Ash, Executive Vice President, RE/MAX Canada. “We must continue to educate Canadians from a practical, real world, point of view. What is affecting the Canadian housing market right now? Low Interest rates, economic stimulus, higher home-buying budgets, a higher savings rate, homeowners too scared to sell, and not enough new construction. These factors have created current market conditions.”
Adds Alexander, “The Canadian housing market has historically given homeowners great long-term returns and solid financial security, but there’s no doubt that the rapid price growth we’ve experienced recently is cause for concern. However, it’s not cause for panic. The data shows single-detached home price acceleration may be starting to level off in some urban centres, but prices continue to rise in many smaller cities and communities that were once havens for affordability. Real estate has been a boon to the Canadian economy, during the pandemic and before it. We believe in the long-term health of Canada’s housing market, but in order to protect it, we need to acknowledge and address the housing supply shortage. Our current government needs to stop applying band-aids and cure the problem at its root.”
About the 2021 RE/MAX Fall Housing Market ReportThe 2021 RE/MAX Fall Housing Market Outlook Report includes data and insights from RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments. Regional summaries with additional broker insights can be found at REMAX.ca. The fall outlook is based on predictions of RE/MAX brokers and agents. The overall outlook is based on the average of all regions surveyed, weighted by the number of transactions in each region.
*2020 average residential sale price numbers were full-year, 2021 were from January 2021-August 31, 2021.
.fusion-accordian #accordion-24200-1 .panel-2876c8bcc3421a01b .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-2876c8bcc3421a01b .toggle-content{color:#747474;}RE/MAX 2021 HOUSING MARKET OUTLOOK Canada Housing Market Forecast Average prices of homes in Canada expected to increase Re-location trend seen among Canadian home buyers The impact of COVID-19 on Canada’s housing market Canadian Housing Market Insights Western Canada Ontario Atlantic Canada Average Price of Houses in Canada Expected to Go Up RE/MAX Canada expects average residential prices to rise 4% to 6% in 2021 35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021 45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021 Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021 52% of Canadians believe real estate will remain one of the best investment options in 2021 Canadians on the move: Not an exodus, but the re-location trend across Canadian housing market is real.RE/MAX Canada is anticipating healthy housing price growth in 2021, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing housing supply shortage is likely to continue, presenting challenges for home buyers and putting upward pressure on prices. Due to these factors, the 2021 RE/MAX Housing Market Outlook Report estimates a four to six per cent increase in the average residential sales price nation-wide.
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“We’ve seen a lot of anecdotal evidence since the summer that households are considering significant lifestyle changes by relocating to less-dense cities and neighbourhoods,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “This has sparked unprecedented sales this year in suburban and rural parts of Canada and we expect this trend to continue in 2021.”
Despite the disruption of the virus, consumers are feeling optimistic, according to a Leger survey conducted on behalf of RE/MAX Canada, with 52 per cent of Canadians eyeing real estate as one of the best investment options in 2021, and expressing confidence that the Canadian housing market will remain steady next year.
The Impacts of COVID-19 on the Canadian Housing MarketWhile many economists predicted employment disruptions would negatively impact the Canadian housing market, the pandemic directly influenced only six per cent of Canadians to sell their home, according to the survey. Furthermore, 40 per cent of Canadians realized that their home needed renovations during the pandemic, and 29 per cent discovered that they need more space.
When it comes to where Canadians would prefer to live – urban, suburban or rural – they are evenly split, with roughly three in 10 preferring to live in each area. In fact, many suburban markets across the country have been heavily impacted by out-of-town buyers, a segment that is expected to drive market activity in 2021. This was a trend that was evident in many regions across the country, including North Bay, Kingston, Moncton and Greater Vancouver, among others.
Unsurprisingly, younger Canadians (under age 35) are significantly more likely to have realized that they need more space and are motivated to move out of their current neighbourhood.
“Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “While we’ve seen a significant shift in buyer preferences this year, we believe factors such as the supply issue, pent-up demand and historically lower interest rates will continue to fuel activity in 2021.”
A deeper dive: 2021 Canadian housing market insightsRE/MAX brokers and agents were asked to provide an analysis on their local market activity in 2020, as well as an outlook for 2021. Heading into the new year, 84 per cent of RE/MAX brokers and agents surveyed are anticipating sellers’ markets.
WESTERN CANADAVancouver and Greater Vancouver are good examples of the steady activity that’s anticipated to continue in 2021. According to the RE/MAX broker network in western Canada, sellers’ markets are likely in both regions next year, driven in large part by low inventory levels, low interest rates and high demand, as was the case in 2020. In Greater Vancouver, suburban neighbourhoods such as Pitt Meadows, Ladner and Maple Ridge are expected to be top neighbourhoods next year due to affordability and easy access to more outdoor space. Both regions are expected to see average residential prices increase by four and five per cent respectively in 2021.
Markets in Calgary and Edmonton, on the other hand, are currently balanced, which is anticipated to continue into 2021. The luxury market in Edmonton continues to be strong, with seemingly no impact felt by the pandemic. Both regions are predicting to see average residential prices increase by two and three per cent next year.
Get more insights and download the infographics: Victoria, BC Nanaimo, BC Vancouver, BC North Vancouver, BC West Vancouver, BC Tri-City (Greater Vancouver), BC Fraser Valley, BC Kelowna, BC Edmonton, AB Calgary, AB Saskatoon, SK Regina, SK Winnipeg, MB
ONTARIOAccording to the RE/MAX broker network in Ontario, market activity across the province is estimated to remain very steady in 2021, with the potential for average sale price increases of between seven and 12 per cent in regions like London (10 per cent), Kitchener-Waterloo (seven per cent), Hamilton-Burlington (seven per cent), Niagara (12 per cent), and Kingston (10 per cent), Cornwall (10 per cent) and Thunder Bay (10 per cent). This is being attributed to high demand and low supply, coupled with shifting home-buying trends toward local liveability factors such as more space, larger yards and closer proximity to amenities like parks.
Move-up and move-over buyers are also impacting luxury segments in the province. Cities such as Ottawa and Hamilton-Burlington have seen a massive spike in demand for luxury homes since the start of the pandemic. This is expected to continue in 2021.
The urban-to-suburban buyer interest in Ontario has impacted Toronto’s downtown core, specifically for condos, which is currently a buyer’s market. Supply levels throughout Toronto are continuing to drop and are not expected to improve in 2021, which will impact average home prices. Immigrants are also expected to drive some market activity next year, which alludes to those coming to Toronto for education purposes, along with the expected influx of immigration from outside the country. Similar to Ottawa and Regina, Toronto’s luxury market remains unimpacted by COVID-19 and is driven by move-up buyers.
Get more insights and download the infographics: Windsor, Ont. London, Ont. Niagara Region, Ont. Kitchener-Waterloo, Ont. Hamilton-Burlington, Ont. Oakville, Ont. Mississauga, Ont. Toronto, Ont. York Region, Ont. Durham Region, Ont. Brampton, Ont. Barrie, Ont. Collingwood, Ont. Muskoka, Ont. Sudbury, Ont. North Bay, Ont. Thunder Bay, Ont. Kingston, Ont. Ottawa, Ont. Cornwall, Ont.
ATLANTIC CANADAMuch like the rest of the country, the majority of Atlantic Canada is a sellers’ market, which is anticipated to continue next year. In Moncton, Halifax and Saint John, housing activity has been driven primarily by out-of-province buyers and move-up buyers who have either expedited retirement plans or are working from home and no longer need to be in an office.
Overall, similar to other areas across the country, increased space has become a prominent buyer demand in the wake of the pandemic, with detached homes serving as the most popular home type in cities like Moncton, Saint John and Charlottetown. This is expected to persist in 2021 according to RE/MAX Canada brokers in the region.
Get more insights and download the infographics: Fredericton, NB Saint John, NB Moncton, NB Halifax, NS Charlottetown, PEI St. John’s, Newfoundland
Additional findings from the 2021 RE/MAX Canadian Housing Market Outlook Report: More than one-third (36 per cent) would prefer to work with realtors who use technology/virtual services to enhance the buying/selling process 15 per cent of Canadians have spent more time researching/monitoring the real estate market during the first and second wave of the pandemicAbout the 2021 RE/MAX Canada Housing Market Outlook Report The 2021 RE/MAX Canada Housing Market Outlook Report includes data and insights supplied by RE/MAX brokerages and local real estate boards. RE/MAX brokers and agents are surveyed on market activity and local developments. Regional summaries with additional broker insights can be found at blog.remax.ca.
About Leger Leger is the largest Canadian-owned full-service market research firm. An online survey of 1,534 Canadians was completed between November 6 and 8, 2020 using Leger’s online panel. Leger’s online panel has approximately 400,000 members nationally and has a retention rate of 90 per cent. A probability sample of the same size would yield a margin of error of +/- 2.51 per cent, 19 times out of 20.
.fusion-accordian #accordion-24200-1 .panel-dcc4ebd716eaeeaa0 .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-dcc4ebd716eaeeaa0 .toggle-content{color:#747474;}RE/MAX FALL 2020 HOUSING MARKET REPORT Canadian housing market expected to remain active for the remainder of 2020 due to pent-up demand and low inventory levels, say RE/MAX brokers and agents Canadians showing more interest in suburban and rural homes for sale, as work and life dynamics shift Canadian housing prices anticipated to increase by 4.6% in the third and fourth quarter according to RE/MAX brokers and agents. This is compared to the earlier prediction by RE/MAX brokers and agents of +3.7% at the start of the year. 32% of Canadians no longer want to live in urban centres, opting for rural or suburban communities instead. Canadians are almost equally split in their confidence in Canadian housing market, with 39% as confident as they were before the pandemic, and 37% slightly less confident.Leading indicators from RE/MAX brokers and agents across the Canadian housing market point to a strong market for the remainder of 2020. According to the RE/MAX Fall Market Outlook Report, RE/MAX brokers suggest that the average residential sale price in Canada could increase by 4.6 per cent during the remainder of the year. This is compared to the 3.7 per cent increase that was predicted in late 2019.
The pandemic has prompted many Canadians to reassess their living situations. According to a survey conducted by Leger on behalf of RE/MAX Canada, 32 per cent of Canadians no longer want to live in large urban centres, and instead would opt for rural or suburban communities. This trend is stronger among Canadians under the age of 55 than those in the 55+ age group.
Not only are Canadians more motivated to leave cities, but changes in work and life dynamics have also shifted their needs and wants for their homes. According to the survey, 44 per cent of Canadians would like a home with more space for personal amenities, such as a pool, balcony or a large yard.
“While COVID-19 lockdowns slowed the Canadian housing market at the start of a typically busy spring market, activity bounced back by early summer in many regions, including Vancouver and Toronto,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained, and current market activity further exemplifies this. Many homebuyers are now exploring different neighbourhoods that better suit their new lifestyles, and real estate agents are getting busier and working more with buyers from different major cities. According to our brokers and agents across the RE/MAX network, Canada’s fall market is expected to see spring market-like activity.”
Looking ahead at the Canadian housing marketRE/MAX brokers across Canada were asked to provide an analysis on market activity during COVID-19 lockdowns, assessing how their regions have bounced back with easing restrictions. They also provided a prediction of market activity for the remainder of 2020. Unsurprisingly, most provinces experienced a slowdown in March and April, with significant drops in activity up to 70 per cent year-over-year. Prices, however, have remained stable across the country. Heading into fall, 50 per cent of RE/MAX brokers and agents surveyed anticipate a modest increase in average residential sale prices.
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Western Canada Housing MarketWhile COVID-19 lockdowns in March and April slowed down the housing market in Western Canada, transactions in Kelowna, Saskatoon and Vancouver resumed by May, with sales in both May and June surpassing year-over-year levels. Many buyers put their plans on hold at the peak of COVID-19 lockdowns, but they returned to the market quickly to make up for lost time. Edmonton’s housing market quickly bounced back to pre-COVID levels in June, while Saskatoon experienced its busiest June in years; this momentum is anticipated to continue into the fall market, with RE/MAX brokers and agents estimating a three-per-cent increase in average residential sale prices for the remainder of the year. Overall, brokers and agents in Western Canada say the potential buyers they are talking to are not too concerned with a potential second wave of COVID-19 impacting their real estate journey, and RE/MAX brokers are estimating steady activity to round out 2020.
Regional housing market insights: Victoria, BC Nanaimo, BC Vancouver, BC Whistler, BC Kelowna, BC Edmonton, AB Calgary, AB Saskatoon, SK Regina, SK Winnipeg, MB
Ontario Housing MarketWith Ontario being one of the hardest-hit provinces in Canada, markets like Niagara, Mississauga and Kitchener-Waterloo experienced significant drops in activity, but bounced back aggressively in June as economies began reopening. Toronto continues to be a sellers’ market with low listing inventory and high demand. An uptick in new listings is anticipated for the fall market, now that buyers and sellers are more comfortable engaging in the housing market, with all of Ontario now in phase three of re-opening. RE/MAX brokers estimate a five-per-cent increase in average residential sale price in Toronto for the remainder of the year. According to the RE/MAX broker network in Ontario, market activity in the province is estimated to remain steady in the fall, with the potential for modest price increases of up to six per cent in regions like Hamilton, Brampton and London.
Regional housing market insights: London, Ont. Niagara Region, Ont. Kitchener-Waterloo, Ont. Hamilton-Burlington, Ont. Mississauga, Ont. Toronto, Ont. Brampton, Ont. Sudbury, Ont. Thunder Bay, Ont. Durham Region, Ont. Ottawa, Ont.
Atlantic Canada Housing MarketRegions with low case counts of COVID-19, such as Halifax, Charlottetown and Saint John experienced slower activity in March, but the decline was less pronounced than that of some Ontario and Western Canada markets. Halifax continues to experience a shortage in listing inventory since before COVID-19, and the shortage has caused an uptick in average residential sale price. RE/MAX brokers anticipate a 10-per-cent increase in average residential sale price in Halifax for the remainder of the year. Activity in Atlantic Canada was back to pre-COVID-19 levels by May 2020, and like many sellers’ markets in Canada, multiple offer scenarios continue to happen in these regions.
Regional housing market insights: Saint John, NB Halifax, NS Charlottetown, PEI St. John’s, Newfoundland
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Pent-up demand causing sellers’ market-like conditions in recreational marketsWhen it comes to recreational property markets in Canada, the regions surveyed for the report experienced a slight decrease in sales activity in March, similar to most major cities in Canada; however, similar to other markets, this picked up quickly by May. Muskoka, Peterborough and the Kawarthas, and Whistler are all experiencing sellers’ market conditions, with pent-up demand and low inventory driving a modest increase in pricing. According to RE/MAX brokers, average prices in these recreational markets are estimated to remain stable for the remainder of 2020.
In lockstep with the Leger survey revealing increased consumer interest in relocating to rural areas, as well as 48 per cent of Canadians wanting to living closer to green space, RE/MAX brokers and agents have reported that many buyers in Toronto and Vancouver, who are now working remotely, have expressed interest in regions like Muskoka and Peterborough and the Kawarthas, and Whistler, in search of more space and access to nature.
Canada’s luxury real estate continues to thriveWhile the classification of “luxury homes” is specific to each region and differs across the country by minimum pricing, Canada’s overall luxury market has remained strong throughout the pandemic, with market conditions unchanged from the beginning of the year in most regions.
When it comes to the hottest Canadian housing markets of Toronto and Vancouver, the luxury segment here is considered balanced, with Vancouver pushing into a sellers’ market. Vancouver is beginning to see more interest from move-up buyers instead of the foreign buyers who drove demand in Vancouver’s luxury market prior to COVID-19. This was likely due to travel restrictions brought on by the pandemic. In Toronto, activity was slower than usual this spring as buyers did not have any urgency to transact during the pandemic. Both luxury markets are could likely remain balanced for the remainder of the year, according to RE/MAX luxury specialists.
The luxury segment in secondary markets such as Hamilton are seeing a slight uptick in activity, with high-end buyers also seeking more square footage and larger properties outside of city centres. Hamilton has experienced an increase in buyer interest from residents from Brampton and Mississauga looking to relocate to the region.
“The classically hot spring market that was pushed to the summer months due to the COVID-19 pandemic created a surprisingly strong market across Canada and across all market segments,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Looking ahead, government financial aid programs may be coming to an end in September, which could potentially impact future activity; however, the pent-up demand and low inventory dynamic may keep prices steady and bolster activity for the remainder of 2020. Overall, we are very confident in the long-term durability of the market.”
Survey respondents split on their confidence in the Canadian housing marketThe survey found that Canadians are almost equally split in their confidence in Canada’s real estate market, with 39 per cent as confident as they were prior to the pandemic, and 37 per cent slightly less confident. When it comes to the prospect of a second wave of COVID-19, 56 per cent of Canadians who are feeling confident in Canada’s real estate market are still likely to buy or sell.
In re-contacting the respondents who lost confidence about their local housing market from the RE/MAX Global Outlook Report survey that was conducted in May 2020, asking if their confidence level in their market has changed since the start of the pandemic, 40 per cent are now as confident as they were before the pandemic. This is compared to their responses in May, which found that 58 per cent were less confident in their housing market, alluding to growing optimism in the market as COVID-19 lockdown restrictions continue to ease across the country.
Additional highlights from the 2020 Fall Canadian Market Outlook Report Survey:
48 per cent of Canadians would like to live closer to green spaces 48 per cent of Canadians say its more important than ever to live in a community close to hospitals and clinics 33 per cent of Canadians would like more square footage in their home and have realized they need more space 44 per cent of Canadians want a home with more outdoor space and personal amenities (i.e. balcony, pool etc.)About the 2020 RE/MAX Fall Market Outlook Report
The 2020 RE/MAX Fall Market Outlook Report includes data and insights from RE/MAX brokerages. RE/MAX brokers and agents are surveyed on market activity and local developments. Regional summaries with additional broker insights can be found at REMAX.ca.
.fusion-accordian #accordion-24200-1 .panel-bf2a1ffcab534c05b .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-bf2a1ffcab534c05b .toggle-content{color:#747474;}RE/MAX 2020 HOUSING MARKET OUTLOOK Average home price expected to rise by 3.7% next year• Increased consumer confidence could be a key factor affecting the housing market in 2020 • 51% of Canadians are considering a home purchase in the next five years, up from 36% at the same time last year • Only two in 10 Canadians say that the mortgage stress test negatively affected their ability to purchase a home in 2019
RE/MAX is calling for a leveling out of the highs and lows that characterized the Canadian housing market in 2019, particularly in Vancouver and Toronto, as we move into 2020. Healthy price increases are expected next year, with the RE/MAX 2020 Housing Market Outlook Report estimating a 3.7 per-cent increase in the average residential sale price.
Most individual markets surveyed across Canada experienced moderate price increases year-over-year from 2018 to 2019. However, some regions in Ontario continue to experience higher-than-normal gains, including London (+10.7 per cent), Windsor (+11 per cent), Ottawa (+11.7 per cent) and Niagara (+12.9 per cent).
As more Canadians have adjusted to the mortgage stress test and older Millennials move into their peak earning years, it is anticipated that they will drive the market in 2020, particularly single Millennials and young couples. A recent Leger survey conducted by RE/MAX found that more than half (51 per cent) of Canadians are considering buying a property in the next five years, especially those under the age of 45.
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BRITISH COLUMBIA
Reduced foreign buyer activity has opened up more opportunity for local buyers in Greater Vancouver’s condo market. While average residential sale prices for all properties increased by two per cent, from $1,030,829 in 2017 to $1,049,362 in 2018, the number of sales dropped by 30 per cent. The low absorption rate is expected to bring down average residential sale prices in 2019 by three per cent
Similarly, the number of sales year-over-year has dropped by 33 per cent in Kelowna. Rising interest rates, government policy changes and the mortgage stress test were all factors that contributed to the decline, which is expected to continue into 2019. Average residential sale prices increased by six per cent year-over-year from $674,930 in 2017 to $718,915 in 2018, with prices expected to decrease by three per cent in 2019.
“The drop in sales in key markets across British Columbia can be partially attributed to Canadians’ increasing difficulty in getting an affordable mortgage in the region,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The situation created by the introduction of the mortgage stress test this year, as well as continually increasing interest rates, means more Canadians will be priced out of the market.
THE PRAIRIES
Alberta continues to experience slowing economic conditions, which have contributed to a decrease in average residential sale prices in Calgary, from $478,088 in 2018 to $460,532 in 2019. Condos are the easiest way for first time homebuyers to get into the market, with starter units going for as low as $150,000. While the city’s unemployment rate continues to remain high compared to the rest of Canada, the population is increasing, with more people moving to the city from other parts of the province.
On the other hand, Winnipeg has shown a small increase in average residential sale price, both for freehold and condominium properties, by 1.5 and 0.8 per cent, respectively. The number of properties sold also increased by five per cent, from 8,139 in 2018 to 8,539 in 2019. Immigration to the city, in combination with reasonable prices and ample supply of inventory, is expected to drive sales going into 2020. Regina also saw the number of properties sold increase by more than five per cent year-over-year, despite being one of the few markets where the effects of the mortgage stress test are still being felt.
ONTARIO
Toronto is set to experience a strong housing market in 2020. Lower unemployment rates, economic growth and improved overall affordability in the Greater Toronto Area are expected to drive the market forward. The estimated average sale price increase for 2020 is six per cent, two points higher than the growth experienced between 2018 ($736,256) and 2019 ($766,236). The city saw 76,413 properties sold in 2019, up 12 per cent from 2018 (68,064). While Toronto is experiencing its “busiest” construction season ever, housing supply still falls short of the demands of the city’s rapidly growing population.
Cities such as Ottawa and Windsor are seller’s markets, showing substantial increases in average residential sale price at 11.7 and 11 per cent, respectively. This strong growth is expected to continue into 2020, with Ottawa’s new LRT system impacting surrounding development and Windsor’s continued affordability attracting young professionals to the area. Buyers are also not burdened by the mortgage stress test, as they were in 2018.
The Niagara region is also showing strong growth, with average residential sale price increasing almost 13 per cent, from $378,517 in 2018 to $427,487.50 in 2019. Value-conscious consumers from the Greater Toronto Area are buying in droves, with many choosing to live in the region while commuting to Toronto.
“Southern Ontario is witnessing some incredibly strong price appreciation, with many regions still seeing double-digit gains,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “Thanks to the region’s resilient economy, staggering population growth and relentless development, the 2020 market looks very optimistic.”
ATLANTIC CANADA
In Atlantic Canada, Halifax and Saint John have experienced solid price appreciation of six and five per cent, respectively. Affordability continues to attract many buyers in the region, most of whom are buying single family homes. At the same time, the region’s multi family and condo market is being driven by retirees. Conversely, the real estate market in St. John’s is expected to recover in 2020, with increased consumer confidence expected to bring about stabilization. However, the city’s aging population and high rate of outbound migration is expected to have an impact on housing market activity at some point.
Key Findings from the 2020 RE/MAX Housing Market Outlook Omnibus SurveyFifty-one per cent of Canadians are considering buying a property in the next five years. This is up from 36 per cent at the same time last year. The increase is attributed to consumers’ adjustment to the mortgage stress test and increased purchasing power. Only two in 10 survey respondents said the mortgage stress test has negatively impacted their ability to purchase a home.
Liveability continues to be important to Canadians, with more than half wanting to live closer to green spaces and shopping/dining locations. Specific figures:
• 62% of Canadians would like to live near shopping/dining locations • 59% would like to live closer to green spaces • 30% would like to live closer to work • 36% would like to live closer to public transit
Learn about RE/MAX real estate franchise opportunities in Ontario-Atlantic Region and Western Canada.
.fusion-accordian #accordion-24200-1 .panel-5619f435a3057b959 .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-5619f435a3057b959 .toggle-content{color:#747474;}RE/MAX 2019 HOUSING MARKET OUTLOOKCANADIAN HOME PRICES EXPECTED TO INCREASE BY 1.7 PER CENT IN 2019
Modest price increases are expected in 2019, as the RE/MAX 2019 Housing Market Outlook estimates the average sales price to increase by 1.7 per cent. Housing markets across the country have stabilized in 2018, after the unprecedented increases in average sales price that many markets experienced in 2017. However, there continue to be some outliers in 2018 average sales price gains, particularly in areas outside of the main city centres, such as Chilliwack (+ 13%), Windsor (+13%), London (+17%) and Charlottetown (+11%).
It is anticipated that the market will continue to stabilize, as Canadians will start to feel the pinch of higher interest rates as they move forward with their home-buying plans in 2019. A recent survey revealed almost one-third (31 per cent) of Canadians said higher interest rates have not affected their ability to get an affordable mortgage thus far. However, this is expected to change in 2019. A separate survey of RE/MAX brokers and agents found 83 per cent predict rising interest rates will make it more difficult for Canadians to purchase a home next year.
British Columbia Reduced foreign buyer activity has opened up more opportunity for local buyers in Greater Vancouver’s condo market. While average residential sale prices for all properties increased by two per cent, from $1,030,829 in 2017 to $1,049,362 in 2018, the number of sales dropped by 30 per cent. The low absorption rate is expected to bring down average residential sale prices in 2019 by three per cent
Similarly, the number of sales year-over-year has dropped by 33 per cent in Kelowna. Rising interest rates, government policy changes and the mortgage stress test were all factors that contributed to the decline, which is expected to continue into 2019. Average residential sale prices increased by six per cent year-over-year from $674,930 in 2017 to $718,915 in 2018, with prices expected to decrease by three per cent in 2019.
“The drop in sales in key markets across British Columbia can be partially attributed to Canadians’ increasing difficulty in getting an affordable mortgage in the region,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The situation created by the introduction of the mortgage stress test this year, as well as continually increasing interest rates, means more Canadians will be priced out of the market.
Prairies Slowing economic conditions in Alberta have contributed to a decrease in average residential sale prices in Edmonton, from $393,003 in 2017 to $379,539 in 2018. While economic recovery is expected to take some time, the luxury market is thriving, with prospective investors in cannabis and migrant speculators driving this new segment. Meanwhile in Calgary, the market is expected to stay relatively flat in 2019 due to its reliance on the oil and gas industry, and further real estate hindrances like the mortgage stress test.
Conversely, Winnipeg has shown a moderate increase of average residential sale price, rising from $315,720 in 2017 to $323,001 in 2018. Looking ahead to 2019, prices are expected to continue on this upward trajectory, with an expected increase of four per cent. Although the senior population is downsizing, immigration to Winnipeg from urban centres such as Toronto and Vancouver (15,000 people move to Manitoba every year) is expected to drive sales going into 2019. In Saskatchewan, both Regina and Saskatoon have experienced a buyers’ market which is set to prevail into 2019.
Ontario In Toronto, rising interest rates and the mortgage stress test were the two major factors affecting market activity this past year, with average sale prices dropping by four per cent from $822,572 in 2017 to $789,181 in 2018, and unit sales down by 16 per cent. Lack of affordability in the single-detached segment will make it difficult for buyers wanting to enter the freehold market. The resale condo market, on the other hand, now represents almost 37 per cent of total residential sales, with its relative affordability fueling the rise of vertical growth. Average residential sale price is expected to increase by two per cent in 2019.
Communities such as Ottawa and London are sellers’ markets, showing increased growth in average residential sale price. This trend is expected to continue into 2019, however rising interest rates and the stress test continue to make it difficult for prospective buyers in other Ontario communities, including Barrie, Oakville and Durham regions.
Due to the stress test and increasing interest rates, we are seeing more buyers in traditionally affordable regions in Ontario unable to enter the market,” says Christopher Alexander, Executive Vice President and Regional Director, RE/MAX of Ontario-Atlantic Canada. “This is particularly true for first-time buyers and single Millennials, as evident in cities like Brampton, Kingston and Durham.
Atlantic Canada In Atlantic Canada, Halifax, Saint John and St. John’s have all experienced stable price appreciation in 2018. Detached homes continue to be the most in-demand property type, while the region’s aging population and retirees are driving the condominium market. The economic slowdown and drop in oil prices in St. John’s have resulted in a buyer’s market, but activity is expected to pick back up in the latter half of 2019.
The RE/MAX 2019 average residential sale price expectation for Canada is an increase of 1.7 per cent.
Key Findings from the RE/MAX 2019 Canadian Housing Market Outlook Omnibus SurveyThirty-six per cent of Canadians are considering buying a property in the next five years. This is down from 48 per cent at the same time last year. The decrease is attributed to actual and perceived impacts of the mortgage stress test and rising interest rates on housing affordability. Thirty-one per cent of survey respondents said higher interest rates have not affected their ability to get an affordable mortgage so far, but the risk of future rate hikes, as indicated by RE/MAX brokers and agents, might affect these buyers in 2019.
Liveability continues to be important to Canadians, with more than half wanting to live closer to green spaces, work and better access to public amenities. Despite the apparent popularity of recreational cannabis since legalization in October 2018, 65 per cent of respondents said they do not want to live near a retail cannabis store. Specific figures:
52 per cent of Canadians would like to live closer to green spaces 47 per cent would like better access to public amenities 35 per cent would like to live closer to work 37 per cent would like to live closer to public transit 35 per cent would like to move to a different neighbourhood 59 per cent strongly disagree with living near a retail cannabis store .fusion-accordian #accordion-24200-1 .panel-718e134536bb72f96 .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-718e134536bb72f96 .toggle-content{color:#747474;}RE/MAX 2018 HOUSING MARKET OUTLOOK THIS PAST YEAR SAW THE SINGLE-FAMILY DETACHED HOME AND CONDO MARKETS DIVERGE ON DISTINCTLY DIFFERENT PATHS IN CANADA’S TWO HIGHEST-PRICED REAL ESTATE MARKETS, GREATER VANCOUVER AND THE GREATER TORONTO AREA, AS REVEALED IN THE 2018 HOUSING MARKET OUTLOOK.The trend is expected to continue into 2018 as a mix of relative affordability for condo units and price appreciation for detached homes in recent years, combined with government policy changes in both markets, has helped push an influx of buyers toward condo ownership.
In Greater Vancouver, demand for condos continues to outpace supply, resulting in the average price of a condo rising an estimated 16 per cent year-over-year, from $553,604 in 2016 to $643,778 in 2017. The GTA’s condo market also saw price appreciation of 22 per cent in 2017, as the average sale price for a condo rose to an estimated $523,437, up from $429,241 in 2016. As condo prices rose, sales for single-family detached homes declined 25 per cent in Greater Vancouver and 22 per cent in the GTA year-over-year between January and the end of October 2017.
The RE/MAX 2018 average residential sale price expectation for Canada is an increase of 2.5 per cent as the desire for home ownership remains strong, particularly among Canadian millennials.
According to a survey conducted by Leger on behalf of RE/MAX, the appetite for home ownership remains strong with roughly half of Canadians (48 per cent) considering the purchase of a home in the next five years. Of those who are considering purchasing a home, the top three reasons for doing so are to upgrade on their current home, to purchase a starter home as a means of entering the housing market and to upsize from their current home to accommodate a change in family make-up. The survey also found that access to outdoor spaces was a key factor for many Canadians when considering purchasing a home, with 87 per cent agreeing that access to green space was important to them and 82 per cent agreeing that having a backyard was important.
In order to find a balance between the home features they’re looking for and affordability, many buyers are continuing to look at real estate markets outside of the country’s largest urban centres. These move-over buyers leaving the GTA and Greater Vancouver have contributed to increased demand and considerable year-over-year average price increases in Kelowna (nine per cent), London-St. Thomas (18 per cent), Hamilton-Burlington (15 per cent), Barrie (19 per cent), Durham region (19 per cent), Niagara (23 per cent), Kingston (eight per cent), and Ottawa (10 per cent).
Much of the activity in regional markets across Ontario was fuelled by price appreciation in Toronto during the first four months of the year prior to the introduction of the provincial government’s Fair Housing Plan. The 16-point plan introduced a 15 per cent non-resident speculation tax, which slowed demand from overseas buyers in the upper-end of the market. The policy changes as a whole curtailed activity significantly for single-family detached homes throughout the GTA in the short-term.
The new OSFI mortgage qualification rules that come into effect on January 1, 2018 also impacted housing market activity toward the end of this year and are expected to slow activity in real estate markets across Canada in the first part of 2018. This fall, a number of regions including Fraser Valley, Edmonton, Regina, Winnipeg, Mississauga and Oakville experienced increased demand from buyers looking to purchase homes before the new stress test regulations take effect.
It is expected that the new mortgage stress test will slow activity across Canada during first few months of 2018 and at the end of November, the Bank of Canada predicted that the new regulations could disqualify up to 10 per cent of prospective home buyers who have down payments of 20 per cent or more. The regions expected to feel the greatest impact of decreased buyer purchasing power are Victoria, Greater Vancouver, Kelowna, North Bay, London-St.Thomas, Barrie, Hamilton-Burlington, the GTA, Durham region, Kingston, Ottawa, Halifax and St. John’s.
As oil prices continue to stabilize, both Calgary and Edmonton have experienced modest average residential sale price increases in 2017. In Calgary, the average residential sale price rose by approximately two per cent, to $487,931 up from $478,100 in 2016. Buyers and sellers remain relatively tentative, but the city’s ongoing evolution into a major tech and distribution hub, as seen with Amazon’s recent announcement that Calgary will house one of the company’s key distribution centres, is expected to increase confidence in the real estate market moving forward. In Edmonton, sales rose by an estimated five per cent year-over-year, from $357,916 to $375,788 in 2017, with a variety of new infrastructure projects, including construction on the Valley Line expansion of the LRT system, expected to contribute to increased activity in the coming years.
.fusion-accordian #accordion-24200-1 .panel-dfff8c3c7a189e597 .panel-title a{color:#00458b;}.fusion-accordian #accordion-24200-1 .panel-dfff8c3c7a189e597 .toggle-content{color:#747474;}RE/MAX 2017 HOUSING MARKET OUTLOOK IGH DEMAND AND LOW SUPPLY CONTINUED TO CHARACTERIZE VANCOUVER’S AND TORONTO’S HOUSING MARKETS THROUGHOUT 2016 AS COMPETITION FROM BUYERS FOR LIMITED INVENTORY OF SINGLE-FAMILY HOMES PUSHED PRICES HIGHER.The average residential sale price increased 13 per cent in Greater Vancouver to approximately $1,020,300 and rose 17 per cent in the Greater Toronto Area (GTA) to an estimated $725,857. Although demand remains high in both urban centres, limited inventory in the freehold market, the new 15 per cent foreign-buyer tax in Vancouver and the recent tightening of mortgage rules by the federal government are expected to soften market activity in the short term. In 2017, RE/MAX estimates average residential sale price will increase by two and eight per cent in Greater Vancouver and the GTA respectively.
Regional markets in close proximity to Canada’s highest-price cities continued to experience steady interest from local move-up buyers and buyers from these cities (“move-over” buyers) who are looking to find a balance between affordability and square footage. This year there were considerable year-over-year average price increases in Barrie (16 per cent), Hamilton-Burlington (20 per cent), the Fraser Valley (20 per cent) and Kelowna (14 per cent).
Regulation changes at both the provincial and federal level towards the end of 2016 are already starting to impact activity in certain markets. The 15 per cent foreign-buyer tax is expected to slow this trend somewhat, as price appreciation declines in Vancouver have resulted in some potential sellers staying in the Lower Mainland. The ripple effect of the foreign-buyer tax can also be felt in the upper end of the GTA and Montreal markets as some foreign investors are expected to look for properties in these regions rather than Vancouver. Measures taken by the federal government to tighten mortgage insurance criteria for new home buyers is expected to temper local rst-time buyer activity across the country in the short term, but is not expected to have a long-term impact in most regions.
Home ownership remains a priority for Canadians, with 53 per cent of respondents in a recent RE/MAX survey conducted by Leger expressing intent to purchase a home and 47 per cent expressing intent to do so in the next five to 10 years. Nearly one in three (30 per cent) Canadians plan to use the purchase of a home as an investment strategy to help fund their retirement, and 42 per cent of millennial respondents view it as a retirement funding strategy. A proportion of Canadians would also consider unconventional home financing options to realize their dream of ownership such as: purchasing a home with a family member (33 per cent); renting a room on a vacation rental site like Airbnb (15 per cent); renting out a room in their home (22 per cent); or even purchasing a home with a roommate (9 per cent).
The housing markets in Calgary and Edmonton remained relatively stable, with moderate declines in the number of sales and average residential sale price as a result of the prolonged recovery of the oil sector over the past two years. The average residential sale price in Edmonton decreased slightly, by two per cent year-over-year in 2016, while Calgary’s average residential sale price decreased by four per cent. Buyer activity is expected to pick up slightly in the second half of 2017 if employment opportunities in the oil sector continue to gradually come back to the province.
High inventory continues to be a factor in many regions including Regina, Montreal, Saint John and St. John’s, offering a good selection of product to first-time and move-up buyers in these cities. Local infrastructure projects and initiatives, such as preparations for Montreal’s 375th anniversary celebrations in 2017, are anticipated to provide a boost to these economies and their real estate markets next year.
.fusion-body .fusion-button.button-6{border-radius:2px 2px 2px 2px;}DOWNLOAD THE FULL REPORT .fusion-body .fusion-builder-column-0{width:100% !important;margin-top : 0px;margin-bottom : 0px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-1{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post Canadian Housing Market Outlook: Fall 2022 appeared first on RE/MAX Canada.
So, you’ve decided to sell your home. No matter what your reasons are for moving, such a big change can be overwhelming. It can seem daunting with everything you need to know. Don’t worry, you’ve come to the right place. Selling your home can be emotional, which is why it helps to have an expert guide you through the process. Your RE/MAX agent has the expertise you need to make it easier to move on, and help you get the best price for your home, and offering guidance on things like home staging. So, what is home staging anyway? Here’s everything you need to know.
What is Home Staging?If you think it means putting on an off-Broadway production in your living room, you’re wrong – but you’ve come to the right place to get the right answer! To put it simply, home staging is a way of presenting your home for sale in a way that helps prospective homebuyers to imagine themselves living there. The process usually includes:
1. Depersonalizing your spaceEven if you’re really proud of your Taekwondo trophy (as you should be!), if it’s on your mantelpiece you should pack it away, along with family photos. (Yes, even the ones of the dog.)
2. DeclutteringThough you may not see it, you probably have years’ worth of items on display such as that coffee table book on origami, your favourite collection of spoons, K-Pop memorabilia, mementos and well, stuff that can be packed away. You may see it as taking away the home’s personality but it’s actually taking away your personality, which allows buyers to see a blank slate that they can put their own personal stamp (or stamp collection) on. Try to think of it as less to pack on moving day. This is the objective of home staging.
3. RedecoratingChanging out stained or worn furniture, painting, reorganizing, decorating can help buyers see the value of your home. Worn out items can distract buyers from looking at the space. This is where a professional home stager is very helpful.
You real estate agent can also advise you on which renovations might help get the best ROI.
Who Pays for Home Staging?The seller typically covers the cost, with the idea that they will recoup the cost (and then some!) in a higher sale price. According to the National Association of Realtors® a survey by the International Association of Home Staging Professionals revealed staged homes (with an investment of one per cent of the listed price) sell up to 30 per cent faster on average for 20 per cent more. These are the key benefits of home staging. Hmmm… suddenly, it doesn’t seem as sad to put away that picture of Grandma on your nightstand!
How Much Does Home Staging Cost?This all depends on the degree of staging required. An older home may need some more intensive updates, such as painting, replacing hardware and light fixtures, or renting new furniture for a period of time. On the other hand, a home that is relatively new and/or updated may only require some simple depersonalizing and decluttering, which costs nothing. In terms of the home staging service, if the seller engages a professional stager then they’ll incur a service fee, which differs by stager. If the seller takes a DIY approach, it’ll just cost them some time and sweat equity.
Ready, Set, Move!When you’re ready to sell your home, consider staging it and consult your RE/MAX agent for advice on how you can potentially sell it faster and for a higher price. Have more questions? RE/MAX has the answers you need. Get more expert home staging tips here.
.fusion-body .fusion-button.button-7{border-radius:2px 2px 2px 2px;}Download the RE/MAX Home Staging Guide.fusion-body .fusion-builder-nested-column-0{width:50% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-nested-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 3.84%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 3.84%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-nested-column-0{width:100% !important;order : 0;}.fusion-builder-nested-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-nested-column-0{width:100% !important;order : 0;}.fusion-builder-nested-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-button.button-8{border-radius:2px 2px 2px 2px;}Find a RE/MAX agent near you.fusion-body .fusion-builder-nested-column-1{width:50% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-nested-column-1 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 3.84%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 3.84%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-nested-column-1{width:100% !important;order : 0;}.fusion-builder-nested-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-nested-column-1{width:100% !important;order : 0;}.fusion-builder-nested-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-builder-column-1{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-1 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-1{width:100% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-1{width:100% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-2{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post What is Home Staging? Is It Worth It? appeared first on RE/MAX Canada.
What is a bully offer? You’ve probably heard this term time and time again, if you’ve been watching Canadian real estate over the past couple of years. But many Canadians still don’t know what it means. A bully offer, also called a pre-emptive offer, is an offer to buy a home that is intended to entice sellers to accept before the offer date. Some follow-up questions likely include:
What is the bully offer process? How much should a bully offer be? Should I accept a bully offer? Should I make a bully offer? Are bully offers ethical?All great questions, and ones you should know the answers to if you’re planning to engage in the housing market. Of course, a professional real estate agent can help answer these questions and more. So, if you aren’t already working with an agent, find one. In the meantime, here are some answers about bully offers.
What is a Bully Offer?A bully offer is an offer to purchase a home tendered before the offer presentation date. A bully offer is typically over asking price and usually time-limited. The idea here is to entice and put pressure on the seller to accept this offer, before other offers start rolling in.
In a hot market, it’s not uncommon for buyers to make offers on multiple listings, only to lose out to another buyer with a better offer. In desperation, the buyer may choose to make a bully offer in an attempt to get ahead of other buyers.
Sometimes a buyer waits until the offer presentation date to make their offer. Then they find out that the home is already sold. In this scenario, the seller has likely been targeted by a bully. You might say the buyer is “bullying” their way past other buyers.
What is the Bully Offer Process?Bully offers are more common in a hot market, when competition between buyers is high. The homebuyer finds a home that piques their interest. Their agent will arrange for a showing as soon as possible, and ideally a home inspection happens. If all goes well then the buyer can choose to make an offer before the seller’s specified offer presentation date.
The listing agent presents this pre-emptive offer to their client. The seller reviews and decides whether to accept, or wait until the offer presentation date to see if they get a better offer.
If the seller accepts the offer, the rest of the process is fairly standard in that the home is taken off the market and the paperwork that follows. If the seller rejects the offer, they would proceed to their offer date and review those offers as they are received.
How Much Should a Bully Offer Be?The objective of a bully offer is to entice the seller, so these types of offers are typically over asking price with conditions that are favourable to the seller. The bully offer won’t be successful unless it really wows the seller. It’s not recommended to buy a home without getting a home inspection first. But against this advice, buyers sometimes forgo this step in a hot market.
Should I Accept a Bully Offer?A bully offer has its pros and cons for the seller, and it’s something the seller should discuss with their listing agent and their family/co-owners. Sellers can benefit in the form of a high price, a quick sale, and eliminating the need for a slew of showings and offer reviews. On the other hand, the seller doesn’t know what other offers may come, since they won’t have a chance to see them. When deciding if this approach is right for you, discuss market conditions with your real estate agent, including buyer demand and competition, and selling prices of comparable listings.
Should I Make a Bully Offer?Buyer beware – a bully offer isn’t a way to get a deal on a home, but it is a way to get the home you really want. Some buyers choose to make a pre-emptive offer if they are consistently getting outbid on a number of other opportunities. The buyer should consider how badly they want this home, if they can afford it, and what their competition is like under current market conditions and in this specific neighbourhood. Discuss these factors with a real estate agent, who may advise that a pre-emptive offer is unnecessary. Ultimately, it is up to the homebuyer to decide how they’d like to proceed.
Are Bully Offers Ethical?Bully offers have become a hot topic since the Canadian real estate market hit a peak during the pandemic. It was not uncommon for one listing to receive 75 offers in some of the country’s most active housing markets. Since there can only be one buyer, this left 74 still-hopeful homebuyers returning to browse listings and in some cases, make a pre-emptive offer on the next home. Real estate industry experts attribute this spike in demand and rising prices to a critical housing supply shortage, which will likely intensify without imminent intervention. This, despite tempering demand and moderating price growth in the wake of the Bank of Canada’s interest rate increases this year. Needless to day, home-buying is a tough go for many homebuyers, and particularly first-timers.
In an effort to increase fairness in the home-buying process, the Ontario Real Estate Association (OREA) recommended the elimination of bully offers back in 2019. OREA’s Vision for a Modern REBBA: Getting to the Highest Professional Standards in North America outlined 28 recommendations that would modernize real estate rules and professionalism in the industry. One of these targeted bully offers.
“If a home listing includes an offer date, that’s the date on which all offers should be considered; an offer made before that date, which is known as a pre-emptive, or ‘bully offers’, should not be allowed,” said Karen Cox, then-president of OREA. “This will ensure that all interested buyers of a particular home get a fair shot at making an offer. For sellers, it means they will have a chance to work with their REALTOR® to carefully and thoughtfully consider all offers without feeling like they are in a pressure cooker.”
Work With a Professional Real Estate AgentNavigating the housing market as a homebuyer or seller can be challenging, and there’s lots to consider that will impact not just your imminent transaction, but your life for many years to come. Work with an experienced, professional real estate agent to ensure you have the answers to all your questions.
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You’ve got your mortgage pre-approval, and you’re shopping the market for your perfect home. If you find one that’s priced too close to your limit, you run the risk of being house poor. Let’s look at what it is, what you can do to avoid it, and what to do if you are already house poor.
The Costs of Owning a HomeWhen you begin the process of looking for a home, you may think that the amount in your pre-approval letter and the house sale price are the only things that matter, but that’s not the case. There are several other costs associated with buying and maintaining a home that people often overlook:
Utilities – Your home needs water, electricity, and natural gas to run. You may also require utilities like internet and possibly city services like garbage pickup. Utilities are not factored into a mortgage payment, so you need to add them into your monthly budget or risk having your services turned off.
Property taxes – Sometimes property taxes are included in a mortgage payment, but sometimes they are not. If it is not included, you can visit the website for the property tax authority where you live and enter your home’s address to find out how much your property taxes will be every year.
Maintenance – It might not be tomorrow or the next day, but eventually, something will break in your home, and it will be up to you to repair or replace it. A new home likely won’t have this issue immediately, but if you live in an older home, it’s crucial that you maintain an emergency fund for the inevitable upkeep of the house.
The 32% RuleBeing house poor means that you spend a large portion of your income on your mortgage and other housing expenses, leaving little for other costs. Canada Mortgage and Housing Corporation recommends spending no more than 32 per cent of your pre-tax income on housing expenses. To determine this number in your own circumstances, multiply your pay by 0.32. If you spend that amount or less on your home, then you should be in good shape. If you spend much more on housing, then you might be house poor.
Avoiding Being House PoorBeing house poor can happen for any number of reasons. It could be that you did not take the extra expenses into account. Or perhaps there was a significant drop in income, making for a tight budget. Here are a few tricks to avoid becoming house poor:
Make a larger down payment on the home. Not only will this give you more equity on your home, but it will make your mortgage payments smaller and save you thousands over the life of the mortgage.
Purchase a home that is less than your mortgage pre-approval amount. It may not be your dream home, but a smaller home will be more affordable. You can always upsize to a larger home when you’re financially ready.
Keep an emergency fund. You can never predict when something will break, or there might be a temporary or permanent income change. A dedicated emergency fund that is otherwise untouched could be the difference between living comfortably through a challenging time or being house poor.
What to Do If You Are Currently House PoorIf you have crunched the numbers and figured out that you are already house poor, don’t panic. There are actions you can take to alleviate some of the stress and perhaps get you out of the poor house.
Get a second job. This is not always a practical action, especially if there are children in the picture, but a second job could give you the funds you need to keep your home and your lifestyle at their current level. Even a few hours a week at a part-time job or engaging in the “gig economy” can make a difference.
Find a roommate. Charging rent can increase your income, plus a renter will often pay for part of the utilities. If you don’t want someone living in your home permanently, you could consider renting out a room on Airbnb.
Refinance or downsize. If all else fails, it might be time to consider moving into a smaller home that will work better within your budget.
Being house poor is a life circumstance that is stressful, and avoidable. Do your research to ensure that you can afford home ownership, and take the steps necessary to get out of the situation if you find yourself house poor.
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The Canadian real estate market is in a state of flux right now.
It is hard to fathom that Canada’s housing sector recorded unprecedented gains a year ago – from tremendous sales activity to enormous price growth – and now the industry is in the middle of a sharp correction. Every market analyst and financial institution has offered a forecast of how much more the country’s real estate market could fall. The Royal Bank of Canada (RBC) projects a 25-per-cent decline by the end of next year, while Desjardins economists anticipate a 20-per-cent drop over the next year.
Whatever the case may be, the Canadian real estate market – be it major urban centres or cottage country – is going through an exceptional transition. Nobody knows when the trend will turn and when the next expansionist cycle will begin.
So, what is going on exactly? Here is a list summarizing what you need to know about today’s market.
What You Need to Know About This Canadian Real Estate MarketHere are five things you need to know about what is unfolding in the Canadian housing market:
#1 Home Prices Have Started FallingIt is no secret that prices have decreased from their pandemic peak. According to the Canadian Real Estate Association (CREA), the national average home price stood at $629,971 in July, down five per cent from the same time a year ago. When the Greater Toronto Area (GTA) and the Greater Vancouver Area (GVA) are removed from calculations, the country’s average price would be trimmed to approximately $525,000.
In addition, most of the monthly declines have been situated in the Ontario real estate market and the British Columbia housing sector. The Prairies have been flat while Atlantic Canada posted gains.
#2 Housing Demand Has EasedIn response to rising interest rates from the Bank of Canada (BoC), which has impacted mortgage rates (see more below), housing demand has waned nationwide.
CREA data show that national home sales tumbled by 5.3 per cent in July, and monthly activity was 29.3 per cent below July of last year. Moreover, sales have been down in three-quarters of all local markets, led by the GTA, the GVA, Calgary, Edmonton and the Fraser Valley.
“July saw a continuation of the trends we’ve been watching unfold for a few months now; sales winding down and prices easing in some relatively more expensive parts of the country as well as places where prices rose most over the past two years,” said Jill Oudil, Chair of CREA, in a news release.
#3 New Housing Construction Picking UpUnfortunately, new housing construction activity has not returned to the level seen in early 2021. However, the numbers have been gradually increasing this year, according to Canada Mortgage and Housing Corporation (CMHC). In June, housing starts surged to 273,800, below the pandemic peak of 305,622. Urban starts totalled a little more than 257,000 units, while rural starts topped 16,000 units.
“The monthly SAAR was lower in June compared to May; however, the level of housing starts activity in Canada remains historically high and well above 200,000 units since 2020,” said Bob Dugan, CMHC’s Chief Economist, in a statement. “The decrease in monthly SAAR housing starts in Canada’s urban areas was driven by lower single-detached starts in June. Vancouver, Toronto and Montreal all recorded higher total SAAR starts, driven by higher multi-unit starts except for Montreal where single-detached starts posted a higher increase.”
#4 Interest Rates Are RisingThe central bank has lifted the benchmark interest rate to the highest it has been since the financial crisis more than a decade ago. The institution aims to fight three-decade high inflation with quantitative tightening – a blend of higher rates and balance sheet reduction. The hawkish tone at the BoC has impacted borrowing costs for prospective homebuyers.
Mortgage rates – both fixed- and variable-rate mortgages – are climbing higher. But the one trend flying under the radar is the challenge many borrowers experience in passing the mortgage stress test.
The mortgage stress test, which was raised last year, determines if homeowners can still pay their mortgage should interest rates go up. Lenders use this rule to determine if you qualify for a mortgage and how much you can borrow. In today’s rising-rate environment, homebuyers need to make an additional $18,000 to pass the mortgage stress test.
#5 Housing Supply is Still LowCREA figures highlight that housing supply has yet to improve. In July, the number of new residential listings tumbled by 5.3 per cent on a month-over-month basis. CREA noted that the decline was broad-based, as 75 per cent of local markets witnessed a dip in supply.
This trend aligns with a new RE/MAX Canada report, which analyzed eight major Canadian housing markets from coast to coast, and found that seven of them had active inventory levels below the 10-year average.
In addition, CREA reported just 3.4 months of inventory in the Canadian real estate market in July, which is considered historically low. This figure measures the number of months it would take to exhaust current inventory levels at the present sales activity rate.
Will Other Trends Form?The COVID-19 public health crisis took the world by surprise. In Canada, the subsequent housing boom, which occurred amid a collapsing economy and cratering employment levels, perhaps shocked most people. Currently, sales and prices in many markets are moderating, which could be an indicator of stabilizing conditions ahead. But the higher interest rates rise, the more pain will likely be felt among those engaging in the Canadian real estate market.
.fusion-body .fusion-builder-column-4{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-4 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-4{width:100% !important;order : 0;}.fusion-builder-column-4 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-4{width:100% !important;order : 0;}.fusion-builder-column-4 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-5{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post Canadian Real Estate is Changing: What You Need to Know appeared first on RE/MAX Canada.
What are the steps to buying a home? You’re starting to think about becoming a homeowner, or maybe you’ve even started to look at listings. Either way, you likely have lots of questions, from the general “how tos” to specific queries around financing, different home types and locations, to how to make an offer. To help simplify what can be a complicated process, we’ve outlined the steps to buying a house in Canada.
What Are the Steps to Buying a Home?There’s a lot to do, but we’ve narrowed it down. Here’s our 10-step home buying process checklist to get you started!
1. Choose a real estate agent that’s right for you.A home is a huge investment, so work with a realtor that’s knowledgeable, professional and responsive. Treat your search for the right agent like a job interview. Meet with a few different agents, ask lots of questions and check references. Here is a list of 7 questions to ask an agent before you commit.
2. Know your budget.As you already know, buying a home is going to be expensive. Knowing exactly how much it will cost and how much you can spend is a crucial step in making a wise investment. Consider your lifestyle, your income and any current debts you’re carrying. Are you secure in your employment? Are you planning any major life changes in the near future, such as a job change or growing your family? Be mindful of the financial impacts this could have.
3. Explore mortgage options and get pre-approved.A mortgage pre-approval informs you of how much your lender is willing to lend you based on a number of factors, such as your credit rating, income and debts. The lender also guarantees the current interest rate for up to 120 days (time may vary depending on the lender), giving you the freedom to house hunt, knowing that you’re safe from interest rate increases. If rates drop, so too should your guaranteed rate. In addition to the interest rate, be sure to also take into account the terms of the mortgage.
4. Start home hunting.Admittedly, this step that has many sub-steps, but let’s narrow it down a bit. While the old adage of “location, location, location” still stands when it comes to good real estate investments, the recent trend of remote workplaces has given people greater flexibility when it comes to answering that all-important question of “where?” Then comes the what: what type of home do you need to accommodate how you and your family live? Condominiums, townhomes and freehold homes each offer distinct benefits, so ensure you’re choosing something that will work for you for the next rive years. Create a remax.ca account and register to receive listings that meet your criteria when they hit the market.
5. Schedule showings.Did you know your agent can show homes in-person or virtually? Virtual showings have been around for some time, often used for purchases by buyers from overseas, however it has picked-up speed with local buyers too, due to the Coronavirus pandemic. Regardless of how you choose to view the listings, keep your eyes on the prize. Remember your budget and the must-haves outlined in step #4 above.
6. Make an offer.You’ve found the home you want, in a location you like. Now, to make an offer to purchase for a price and terms that are agreeable to both you and the seller. Here’s where working with an experienced realtor can give you the upper hand. Different market conditions require a different approach – a seller’s market might mean lots of competition, requiring you to come in at or over asking price with few to no conditions, while a buyer’s market means you have choice and time is on your side. Lean on your agent on how to best handle the situation.
7. Get a home inspection.Regardless of the market, this is one condition that we recommend you keep as part of your offer. The home inspection is intended to identify any existing or potential underlying problems in a home, alerting the buyer of risks and giving them leverage in negotiating a reduced selling price. Your home inspector will examine systems that are visible without opening walls or floors, including heating, plumbing, electrical, roofing and foundation. The inspection should take approximately three hours and will cost a few hundred dollars, depending on the size of the home.
8. Close the deal.The closing period for your transaction is typically 90 days, however it can range depending on the agreed upon terms in the Agreement of Purchase and Sale. The homebuyer has some important obligations during this waiting period. Once the offer has been accepted, there’s a window during which you must take all the necessary steps with regard to your offer conditions, such as financing, home inspection and anything else that needs to happen before you officially seal the deal. Your mortgage lender will need a copy of the offer to ensure it’s in-line with your pre-approved level of financing. After any adjustments or repairs have been done to your satisfaction, your Realtor will finalize the deal and your lawyer will process the paperwork, including the mortgage documents with your lender. All of this will point to a final date of actual legal possession: the real closing day.
9. Update utilities, transfer services and change-of-address.During your closing period, keep track of utility and credit card bills, magazine subscriptions and any other regular mail or standing orders that you receive at your current address. Alert them of the address change in advance of your closing date. Also be sure to contact your doctor and dentist. For family and friends, you can easily send a change of address card via mail or email, but there are a few more steps when it comes to informing government agencies.
Click here to change your address with the Canada Revenue Agency Contact your local Ministry of Health and Ministry of Transportation to find out how to change your address on your health card and driver’s license. Forward mail to your new address by visiting the Canada Post website or at your local post office. If applicable, it is important to change your address for the Employment Insurance program that you can easily do here. 10. Move into your new home!If you’re moving during the busy season (typically summer) ensure you’ve booked a moving company well in advance. If you’re doing it yourself, book the truck, enlist some help and ensure you have ample packing materials. Here are some packing tips:
Pack the items you will need first in a clear plastic bin Pack your plates vertically so they are less likely to break Take a photo of how you electronics are connected so you can know where the wires go Wrap your breakables in clothing to save on bubble wrap Keep your glassware safe by packing it with clean socks .fusion-body .fusion-button.button-10{border-radius:2px 2px 2px 2px;}.fusion-body .fusion-button.button-10 .fusion-button-text{text-transform:none;}DOWNLOAD THE RE/MAX HOME BUYER’S GUIDE.
We hope this home buying checklist helps. If you still have questions about how to buy a home, or you’re ready to start the process, tap into the knowledge and experience of a RE/MAX agent, who will guide you through the process every step of the way.
.fusion-body .fusion-builder-column-5{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-5 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-5{width:100% !important;order : 0;}.fusion-builder-column-5 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-5{width:100% !important;order : 0;}.fusion-builder-column-5 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-6{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post What Are the Steps to Buying a Home? appeared first on RE/MAX Canada.
Sales activity has slowed considerably in the Ottawa real estate market as broader uncertainty in the nation’s capital impacts everything from single-family homes to condominiums.
Industry experts say many prospective homebuyers are sitting on the sidelines due to uncertainty around current economic conditions. While the higher cost of living is a major factor in today’s economy, according to Ottawa Real Estate Board (OREB) President Penny Torontow, homebuyers are also unsure if they have enough buying power amid rising interest rates.
The Bank of Canada (BoC) recently hiked interest rates by 75 basis points at the last policy meeting. But while the nation’s annual inflation rate cooled to seven per cent in August, policymakers have insisted that they will continue tightening until inflation falls back to its two-per-cent target rate.
In the meantime, this could wreak havoc on the Canadian real estate market. But prices remain strong while demand is waning in the Ottawa housing sector. In fact, the typical sales price is higher than the market average.
Ottawa Real Estate Market Weathering the Storm CloudsNew OREB data show that the average sales price for a residential-class property advanced at an annualized pace of five per cent in August, totalling $707,712. The average sales price for a condominium-class property jumped four per cent year-over-year to just below $422,000.
On a year-to-date basis, the average sales price for residential and condos surged 10 and nine per cent, respectively.
This is higher than the broader Canadian housing market. Last month, the national average home price tumbled 3.9 per cent year-over-year to $637,673, according to the Canadian Real Estate Association (CREA). Plus, when the massive Toronto and Vancouver markets are removed from the equation, the national average price is even lower at just over $500,000.
“Prices are still rising slightly in some areas, albeit lower single-digit per centage increases, bringing back the moderate price-growth stability that is characteristic of the Ottawa resale market. What happened to prices in 2020 and 2021 was unusual. We are moving towards a balanced market state, where Buyers have choices and Sellers need to ensure they are pricing their properties accurately,” Torontow noted in a statement.
She added that buyers are ostensibly taking their time, with Days on Market (DoM) data showing that they have inched closer to the 30-day threshold.
“The lightning speed at which homes were selling at the start of 2022 is a thing of the past,” she said.
Indeed, association numbers confirmed that residential property sales plunged 27 per cent year-over-year, totalling 1,137 units. This included a 27 per cent drop for residential-property class homes (850 units) and a 28 per cent slide for condo-property suites (287 units). Moreover, Ottawa housing supplies are improving, with more than 2,000 properties listed in August. These lifted the months of inventory – a gauge of how long it would take to exhaust current supplies at the present of sales activity – to three months of residential-class homes and 2.2 months for condos.
As fresh supply comes online, could prices start easing? The latest development has been impressive new housing construction activity. According to Canada Mortgage and Housing Corporation (CMHC), housing starts surged more than 44 per cent year-over-year to 1,257 units in August. Year-to-date, housing starts totalled close to 7,200 units, up 11 per cent from the first eight months of 2021.
The Great ‘Reset’ in Ottawa Housing?Much like the rest of the country, the Ottawa real estate market is stuck between a rock and a hard place. On the one hand, tightening monetary policy is allowing prices to soften, allowing prospective homeowners to achieve the dream of homeownership. But on the other, rising interest rates could make it more expensive to borrow and harder to pass a mortgage stress test.
It is unlikely the price growth that occurred during the coronavirus pandemic will be erased, making housing affordability harder in a different way. But many surveys suggest the same thing: Many young people are hoping for a sharp downturn in the housing market so they can get a foot in the door.
Unfortunately, many market experts warn that because the meteoric growth in the real estate market has become tied to the post-crisis economic growth – something that the Bank of Canada (BoC) conceded last year – any significant correction in Canada’s housing sector could create a domino effect for everyone else. And, yes, this also includes the Ottawa real estate industry.
Still, this is a “reset” and “recalibration” for Canada’s housing market, says TD economist Rishi Sondhi.
“Our forecasted decline in national home prices would only partially retrace the 46 per cent run-up over the course of the pandemic. As such, our forecast can be more aptly described as a recalibration of the market, instead of something more severe,” Sondhi wrote in a research note. “Our forecasted peak-to-trough decline in Canadian home sales falls well within the range seen in past housing downturns and was surpassed by the global financial crisis sales tumbled by 38 per cent.”
.fusion-body .fusion-builder-column-6{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-6 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-6{width:100% !important;order : 0;}.fusion-builder-column-6 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-6{width:100% !important;order : 0;}.fusion-builder-column-6 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-7{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post Ottawa Real Estate Market Prices Still Topping National Average appeared first on RE/MAX Canada.
A year ago, housing affordability dominated national conversations as the Canadian real estate market exploded in growth, across major urban centres and rural communities alike.
For the last couple of months, it seems like this discussion has shifted, with affordability taking a back seat given recent moderation in the market following the unprecedented “COVID boom.”
The average price for a home in Canada was sold for about $630,000 in July, recent data from the Canadian Real Estate Association (CREA) confirm. This is down five per cent from the same time a year ago. When the red-hot markets of Toronto and Vancouver are removed from the equation, the typical price for a residential property falls to roughly $525,000.
Despite the last several months of falling Canadian real estate prices and rising interest rates, why are prices not returning to pre-pandemic levels? Be it a single-family house or a condominium, residential prices remain elevated following their meteoric surge.
Is a Lack of Supply Still Keeping Prices High in the Canadian Real Estate Market?According to CREA, residential property sales tumbled by 5.3 per cent month-over-month in July. This represented the fifth straight monthly decline, with transactions down in three-quarters of all local markets.
With demand and home sales means more supply is coming on stream, or existing inventory is sitting on the market longer. However, that increase in offset by demand from several months ago persists.
“July saw a continuation of the trends we’ve been watching unfold for a few months now; sales winding down and prices easing in some relatively more expensive parts of the country as well as places where prices rose most over the past two years,” said Jill Oudil, Chair of CREA, in a statement. “That said, the demand that was so strong just a few months ago has not gone away, but some buyers will likely stay on the sidelines until they see what happens with borrowing costs and prices.”
So, what about supply? The number of new residential listings tumbled 5.3 per cent in July, CREA data found. In addition, months of inventory, which measures the number of months it would take to exhaust current stocks at the present rate of sales activity, surged to 3.4 months by the end of July.
“It’s only one month of data at this point, but it suggests that some sellers are also playing the waiting game, and that is with an overall inventory of homes for sale that is still historically low,” said Shaun Cathcart, CREA’s Senior Economist, in a news release. “The Bank of Canada is also expected to finish up their remaining rate hikes (100 basis points or so) over the next few months, which five-year fixed mortgage rates have mostly already priced in. We’ve already witnessed a sharp housing market adjustment this year, but it will hopefully be short-lived if conditions continue to show signs of stabilizing.”
But new housing construction activity has been robust, increasing by approximately six per cent to 22,229 units in July, according to Canada Mortgage and Housing Corporation (CMHC). On a year-to-date basis, however, housing starts have slumped more than five per cent to 134,684 units.
When it comes to fresh supply being built, it is the major urban centres that have witnessed a decline, the CMHC noted.
“Monthly SAAR housing starts in Canada’s urban areas declined in July, driven by lower single-detached starts. However, Vancouver and Toronto both registered much stronger declines in multi-unit starts than in single-detached starts, while Montreal saw similarly large declines in both unit types,” said Aled Ab Iorwerth, CMHC’s Deputy Chief Economist, in a news release.
While housing stocks are improving, they are still insufficient to keep up with demand.
For example, new listings in the Ontario real estate market advanced 7.2 per cent year-over-year in August, coming in at 26,500 new residential listings, data from the Ontario Real Estate Association (OREA) show. While this is noticeably higher, new listings were seven per cent below the five-year average. Or according to the British Columbia Real Estate Association (BCREA), “inventories remain quite low, but the slow pace of sales has tipped some markets into balanced or even buyers’ market territory.”
As the nation’s population grows amid the federal government’s plan to welcome more than one million immigrants over the next couple of years, demand for Canadian real estate is expected to remain high. Although higher interest rates may minimize some of this demand, the post-pandemic hangover might persist.
Perhaps Jason Mercer, chief market analyst for the Toronto Regional Real Estate Board (TRREB), summarized the situation in the Canadian real estate market best: “We’re seeing a gap in the ‘missing middle.’” Until more housing supply comes online, it will prove to be challenging to see prices come down at a level whereby more families and households feel comfortable making that giant leap into homeownership, whether in downtown Toronto or a small town in Atlantic Canada.
.fusion-body .fusion-builder-column-7{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-7 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-7{width:100% !important;order : 0;}.fusion-builder-column-7 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-7{width:100% !important;order : 0;}.fusion-builder-column-7 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-8{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post Is Low Supply Keeping Canadian Real Estate Prices High? appeared first on RE/MAX Canada.
Tucked on the western edge of Lake Ontario, Hamilton has become a hot spot in recent years. Hamilton’s economy is primarily driven by its manufacturing sector, with healthcare and education also significantly contributing to the local economy.
Hamilton has attracted homebuyers seeking respite from the high prices characterizing Toronto real estate. This exodus has caused prices across Hamilton to rise. From 2021 to 2022, prices rose almost 23 per cent. Homes are selling for an average price of $949,099. With an average mortgage of $759,279.20 and a median after-tax income of $70,100, Hamiltonians are paying 76.22 per cent of their monthly income for their home.
These increases are staggering. Just ten years ago, the average detached home sold for a little below $300,000. Today, they sell for over a million dollars.
Despite the price rise, professionals and young families are still moving to Hamilton. So, what are the best neighbourhoods in Hamilton to buy a house?
Most Liveable Neighbourhoods in Hamilton Beasley: This trendy downtown neighbourhood is one of the oldest neighbourhoods in Hamilton. If you are a young person looking for a fast-paced city feel, this is one of the best options in Hamilton. Stroll James Street and check out the bars, restaurants, and independent businesses. Corktown: Full of history and charm, it is one of the most in-demand neighbourhoods in Hamilton. Located centrally, Corktown offers school, trails, transit, parks, shopping, and restaurants. Situated at the foot of the escarpment, it is growing in popularity for singles and professionals looking for city life at more affordable prices than in Toronto. Crown Point East: DIYers love this neighbourhood. It has long been home to the garment district and has a long history of creativity. Beyond the textiles, Ottawa Street is home to food trucks, a farmer’s market, and retail spaces. It’s a popular local for first-time buyers and young families who appreciate the arts. Normanhurst: This is a popular neighbourhood for families looking to buy a home, with homeowners making up almost 80% of the area. It’s no surprise, as It has exceptional livability scores with prices lower than the Hamilton average and plenty of access to amenities. Homeside: This growing neighbourhood is home to young families and retirees alike. Homeside is for you if you prefer a quieter community with charming older homes.Other popular neighbourhoods include Parkview East, Westdale, Mountainview, Durand, and Gibson. Hamilton’s three most affordable neighbourhoods are Crown Point North, Durand North, and Central South. The region’s most luxurious neighbourhoods, Ancaster Heights, Sulphur Springs and Durand South with average prices over $1.1 million. Proximity to independently owned retailers, gyms, bars and restaurants are some of the top liveability factors for the most affordable and luxurious neighbourhoods in Hamilton.
Hamilton’s Future LiveabilityHamilton’s liveability is expected to continue to improve over the next three to five years. Increased development and a rise in restaurant culture throughout Hamilton make it more attractive for those seeking a neighbourhood with increased density while still experiencing affordable living (comparatively) and access to green space.
#accordion-20067-2 .fusion-panel:hover{ border-color: #e0dede } #accordion-20067-2 .fusion-panel { border-color:#e0dede; }.fusion-accordian #accordion-20067-2 .panel-title a .fa-fusion-box{ color: #ffffff;}.fusion-accordian #accordion-20067-2 .panel-title a .fa-fusion-box:before{ font-size: 13px; width: 13px;}.fusion-accordian #accordion-20067-2 .panel-title a{color:#00458b;font-family:"Roboto";font-weight:regular;}.fusion-accordian #accordion-20067-2 .toggle-content{font-size:15px;color:#747474;font-family:"Roboto";font-weight:regular;}.fusion-accordian #accordion-20067-2 .fa-fusion-box { background-color: #004e9b;border-color: #004e9b;}.fusion-accordian #accordion-20067-2 .panel-title a:not(.active):hover, #accordion-20067-2 .fusion-toggle-boxed-mode:hover .panel-title a { color: #03a9f4;}.fusion-accordian #accordion-20067-2 .panel-title .active .fa-fusion-box,.fusion-accordian #accordion-20067-2 .panel-title a:not(.active):hover .fa-fusion-box { background-color: #03a9f4!important;border-color: #03a9f4!important;}.fusion-accordian #accordion-20067-2 .panel-8ed7356abe6908098 .panel-title a{color:#00458b;}.fusion-accordian #accordion-20067-2 .panel-8ed7356abe6908098 .toggle-content{color:#747474;}2020 Hamilton Liveability ReportHamilton is expected to see a 25-per-cent increase in unit sales for the suburban families and buyers looking to move up in the market. The “move-up” demographic accounts for the majority of buyers in the area. The average price for homes in Hamilton can vary dramatically depending on the neighbourhood.
So, what are the best neighbourhoods in Hamilton to buy a house? RE/MAX explores more than 300 of Canada’s most liveable hot spots in the new 2020 Liveability Report. Here are our top picks for Hamilton and the surrounding area.
10 Most Liveable Neighbourhoods in Hamilton Beasley Corktown Crown Point East Normanhurst Homeside Parkview East Downtown Burlington Mountainview Durand GibsonThe three most affordable neighbourhoods in Hamilton, Crown Point, Homeside and Vincent, range in price from $365,615 to $375,029. The region’s most luxurious neighbourhoods, Ancaster Heights, Sulphur Springs and Durand South range in price from $1,017,450 to $1,043,689. Proximity to independently owned retailers, gyms, bars and restaurants are some of the top liveability factors for the most affordable and most luxurious neighbourhoods in Hamilton.
Hamilton’s Future LiveabilityHamilton’s liveability is expected to continue improving in the next three to five years. Increased development and a rise in strong restaurant culture throughout Hamilton is making it more attractive for those seeking a neighbourhood with increased density while still experiencing affordable living and access to green space.
Hamilton at a GlanceTucked on the western edge of Lake Ontario, Hamilton has become a hot spot in recent years, attracting homebuyers seeking respite from the high prices characterizing Toronto real estate. Hamilton’s economy is largely driven by its manufacturing sector, with healthcare and education also being large contributors to the local economy. Fun fact: there are more than 100 waterfalls in Hamilton!
Best Places to Live in Canada
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Liveability is about quality of life at a local level. A neighbourhood’s dynamism, or lack thereof, involves a delicate convergence between independent small businesses, public institutions, arts and culture, green spaces and housing, to name a few. The COVID-19 tragedy will impact neighbourhood ecosystems differently across the country, just as the virus itself has. Yet, civic/local pride has been proliferating throughout this crisis in inspiring ways, giving Canadians hope that micro-economies, including real estate, have the resilience to be restored in the near and mid-term.
To learn more about liveability in Canada’s biggest housing markets, read the RE/MAX 2020 Liveability Report.
.fusion-accordian #accordion-20067-2 .panel-02a0461bf41f95c92 .panel-title a{}.fusion-accordian #accordion-20067-2 .panel-02a0461bf41f95c92 .toggle-content{}2019 Hamilton Liveability ReportWe know that Canadian’s truly celebrate the liveabililty factors of their neighbourhood – the qualities that give homeowners the true satisfaction of their home within the context of a neighbourhood. In fact a Leger survey conducted by RE/MAX revealed that 89% of Canadians recommend their neighbourhoods to others. Unlike your home, neighbourhoods cannot be changed, so it is important to assess what qualities are important to you before you purchase. Luckily, when it comes to Hamilton, there is a lot of celebrate in terms of liveability.
A survey of RE/MAX Brokers revealed that the best places to live in Hamilton are Meadowlands, Beasley and Sydenham, ranking as the top three neighbourhoods in Hamilton for access to green spaces and parks, walkability, retail and restaurants and the ease of getting around/public transit.
In the same Leger survey, six-in-10 Canadians put easy access to shopping, dining and green spaces at the top of their liveability criteria. Proximity to public transit (36 per cent), work (30 per cent) and to preferred schools (18 per cent), as well as cultural and community centres (18 per cent) fall out of the top five neighbourhood wants and expectations. So how does Hamilton stack up?
If you are searching for the best place to live in Hamilton, Sydenham ranks as the top hidden gem neighbourhood for affordability and good supply of high rises and detached homes.
.fusion-body .fusion-builder-column-8{width:100% !important;margin-top : 0px;margin-bottom : 0px;}.fusion-builder-column-8 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-8{width:100% !important;}.fusion-builder-column-8 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-8{width:100% !important;}.fusion-builder-column-8 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-9{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}The post Best Places to Live 2022: Hamilton Real Estate appeared first on RE/MAX Canada.
The good news is that you’ve found your dream home. The bad news is it’s a bit of a fixer-upper. You’ve saved for the down payment but do not have the money to undertake the necessary renovations. Fear not, homebuyer! There are many options available to help you finance the renovations, so you can stop dreaming and start enjoying your new home.
How to pay for renovations when buying a homeRenovation mortgage financing is one of the most popular renovation financing options for new homebuyers. It allows you to add renovation costs to your mortgage when you purchase your new home. So if your mortgage was $500,000 to cover the purchase price and you needed $60,000 for the renovations, you would assume a mortgage of $560,000.
Though it goes by other names like a purchase plus improvement mortgage, renovation mortgage financing allows you to pay for the renovation with minimum down payments as low as 5 per cent.
Essentially, when you apply for your mortgage, you will also estimate all of the costs associated with your renovations and add those to the mortgage. This can be a smart option for first-time homebuyers as they may not have enough saved to purchase the house and immediately take on a substantial renovation project.
Sometimes, you don’t even know everything that needs to be taken care of until you begin a large renovation project. That’s why you should always put aside some extra for the “unknown.” This might even just be upgraded appliances or furniture when the renovations are through, but having some money set aside is never a bad thing.
An advantage of adding the renovation costs to your mortgage is that you will almost certainly get a better interest rate than you would with a line of credit or a credit card. Furthermore, you pay for your mortgage and renovation with a single payment.
You should also talk to your lender to explore your options and determine if you can meet pre-approval criteria.
How does renovation mortgage financing work?Every lender has different criteria for a renovation mortgage (or a purchase plus improvement mortgage). Here are some standard measures, though you should talk to your lender and understand the exact process.
You assess what renovation needs to be done and provide a rough estimate. Get firm quotes from licensed contractors. Get approval from your lender. Take possession of the home and start renovations. After the renovations are completed and approved, your funds are released.But, what if you already own a home and want to renovate?
Can you use an existing mortgage to pay for renovations?There are several ways a homeowner can leverage the value of their home to finance a renovation. Mortgage refinancing is an option that many look into if they do not want to obtain funds in other ways (lines of credit, loans, etc.). Mortgage refinancing considers how much left you owe on the house, allowing you to borrow up to 80 per cent of the appraised value.
Refinancing your mortgage allows you to undertake the renovations but spread the payment out over an extended period of time with generally less interest than a credit card or personal loan rates.
It is important to recognize that to qualify for renovation mortgage financing; the renovation cost must make sense based on the property’s value or potential value.
Are there other options to finance a renovation?There are several other financing options to finance your renovation, but which one is right for you? The answer depends on your financial situation, the renovation cost, and your home’s value.
If your renovation needs are minor, under $5000, paying with cash, credit card, or a personal line of credit may be a better option than refinancing your home. When the expenses start moving over $20,000, you may start thinking about a Home Equity Line of Credit (HELOC).
A HELOC is a revolving line of credit secured by the equity in your home. Unlike a personal line of credit, which is unsecured, you are borrowing against an asset. This difference means that interest rates are significantly lower when compared to unsecured loans and lines of credit.
If you’re planning a green renovation, you could qualify for a federal grant or loan through the Greener Homes program. The program aims to make homes more energy efficient and comfortable.
Making the value of your home renovationWhether you’re undertaking renovation costs in your mortgage or simply just looking to increase the ROI, it’s essential to know what areas of your house are worth investing in. Understanding the best renovations for the greatest ROI will help you prioritize your to-do list. It’s also good to do some research and understand what types of remodelling mistakes can decrease your home’s value.
So the next time you walk into a home needing work, don’t get scared off immediately if you don’t have the funds readily available to renovate. Whether you use renovation mortgage financing or borrow against an existing mortgage, your dream home may be more achievable than you think.
Looking to enter the market or understand the current value of your home? Contact a local RE/MAX Agent to help get you started.
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