2017: A real estate roller coaster that won’t be forgotten soon

Friday Dec 22nd, 2017

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2017: A real estate roller coaster that won’t be forgotten soon

2017 was a year of highs and lows, dynamism and sputter, and a wide range of opportunities for buyers and sellers of real estate alike. All signs point to an interesting 2018 on the horizon.

The condo market, on the whole, has been resilient and avoided the volatility of the more traditional housing market. Demand and supply remained robust, as buyers across all segments relied on condos for their relative affordability and availability advantages compared to detached housing. Plenty of ongoing construction completed projects, and planned buildings provided the market with confidence that supply levels remained reasonably healthy.

Many younger buyers; Millenials, also turned to condos for their first real estate investment because of availability, choice, and affordability. Although pockets of the GTA had weak to tepid growth in many areas, particularly the inner suburbs, many components of the GTA, such as the downtown core, Markham, Vaughan, Richmond Hill, and downtown Mississauga saw double-digit growth. Overall positive trends in the condo market are likely to continue in 2018.

 

Expect further Bank of Canada rate hikes in early 2018, especially if economic numbers (unemployment, inflation, GDP growth) remain positive. The recent hike in rates by the Federal Reserve will force the Bank of Canada’s hand.

New stress test rules on first time homebuyers will come into effect on January 1, 2018, and will tighten the market by restricting the pool of available buyers. This will have both positive and negative impacts but will likely incentivize many to buy quickly before the end of the year or to increase leverage and debt in any way possible to remain players in the market.

The possibility for even greater government intervention is always strong, especially as the nation’s largest real estate market, Ontario, heads into full election mode in the late winter and spring of 2018. 

 

One way or another, 2018 will be a fascinating year for the world and for southern Ontario real estate.

Amy Khan
 
Forest Hill Real Estate Inc, Brokerage
 
Phone: 416-488-2875
 

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