- Much of the talk these days in real estate in this country is how as the Province’s move into different stage of reopening there’s bound to be some economic bounce back that will help to buoy the market as it makes its own recovery of sorts. All of that is fairly well founded, and good news as well although it’s tempered somewhat by the fact that it appears the 2nd wave of the virus is well on its way and may lead to further shut downs and all the economic turmoil that will come with round 2 of that.
Much of the talk these days in real estate in this country is how as the Province’s move into different stage of reopening there’s bound to be some economic bounce back that will help to buoy the market as it makes its own recovery of sorts. All of that is fairly well founded, and good news as well although it’s tempered somewhat by the fact that it appears the 2nd wave of the virus is well on its way and may lead to further shut downs and all the economic turmoil that will come with round 2 of that.
Nonetheless, we’ve been like many others in the know who’ve stated that the plummeting of home values in this country was a false alarm, and both data and projections from industry insiders have borne out the fact that no, we’re not going to see the housing market take any type of major fall anytime soon, global pandemic or not.
The Statistics Canada 2020 Housing Price Index report of last week is yet another voice adding to the argument that neither homeowners or realtors need to start panicking. Now perhaps that applies more to homeowners than realtors though, as what was a very competitive business is poised to get even more competitive as no matter how you slice it there are going to be a LOT of homeowners from coast to coast who’ll decide to postpone putting their homes on the market.
To that end, our online real estate lead generation system here at Real Estate Leads is an excellent way for realtors struggling to generate new clients to put the power of the Internet to work for them and be put more directly in touch with homeowners who are deciding to throw caution to the wind and put their homes for sale. The same goes for prospective homebuyers too.
But back to our discussion of the Stats Can 2020 House Pricing Index.
New Geography for Canadian Housing Demand
Nationwide, StatCan saw that new house prices rose 0.1% from May 2020 and 1.3% from June 2019. The largest single monthly increase for new home prices was in the St. Catharines-Niagara region with a full 1% jump. Other smaller, more affordable housing markets outside of major urban centres like Guelph, Kitchener-Waterloo, and Kelowna out in BC saw similar growth.
The prairie provinces were where the opposite was seen, with a decline in new housing prices led by Edmonton dropping a considerable 0.2%.
The major markets have gone this way this year; home prices in Toronto were flat from May to June, rising only 0.2% year over year. Prices in Ottawa continued to accelerate though, with price increases of 0.2% in June and 10.4% since last year. Vancouver would be most people’s guess as to who’s the biggest gainer, but actually it only grew by 0.1% from May to June and has actually seen its year over year new home price fall by 0.7%.
Montreal had home prices grow 8.1% year-over-year and is on track for a solid 2020 despite all the doom n’ gloom predictions attached to its market just like all the others.
Atlantic Canada featured Halifax’s 0.5% monthly increase in June and 2.3% price increase year over year, while Saint John, Fredericton and Moncton led the charge for New Brunswick’s markets with a combined 2.3% increase year over year. Admittedly, prices were flat from May to June there this year. The only decline was for St. John’s NFLD, shrinking by 0.1% since last year.
Exurbs Starting to Drive the Market
One thing that’s definitely being seen and can’t be ignored is a significant shift towards exurbs as homebuyers who may now found themselves less tied to a desk realize how much more they can get for their money. Not everyone will just march back to the downtown cores of the major cities and as a result many more people will be able to work from home. It’s reasonable to expect then that greater numbers of working adults may be open to living away from major urban centres to get more out of ‘home’.
This potential shift to working from home will see proximity to work take a backseat to personal and lifestyle desire when it comes to a homebuyer’s choices, and this shift will almost certainly introduce vitality into housing markets in areas of the country that previously struggled to attract both homebuyers and developers who’d consider building homes there.
Overall, StatsCan’s new numbers point to a resiliency in Canada’s housing markets for the most part. One that is something a surprise to even the most positive outlook-inclined experts. While people are definitely waiting to see how the rest of the year shapes up, we don’t need to look any further than the white-hot recreational housing markets in Ontario as evidence that homebuyers feel secure enough in their incomes to be purchasing second homes now.
Mortgage Broker Opportunities
Another aspect to this displayed resiliency in Canada’s key housing markets is that it has the potential to be quite good for brokers. Look, we can now fairly convincingly say that the CMHC’s dire forecasts of a 9-18% drop in home prices nationwide aren’t happening. What we have seen and will continue to see is that the circumstances of this lockdown have driven a change rather than a weakening in the drivers of Canada’s housing market. A change that could be an opportunity for mortgage brokers.
Many people will see record-low mortgage rates as a rationale behind see late 2020 as a very good time to buy, and the majority of them will need the assistance of a mortgage broker in doing so.
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