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What do you think is going to happen to the Canadian housing market in the next, say, year? I am a total real estate noob and really have no idea about anything. The reason I ask is that I was going to buy a house within the next few months, but as my luck will have it, sadly, it's going to have to be put off until the fall.
So rather than be mopey about it, I am wondering about how this might be beneficial to us! We are looking in the GTA and at least from my perspective, housing is kind of overpriced! I am going to have to go WAY out to Oakville/Burlington or Ajax/Whitby-ish to find something decent in the $400-500k range. It's such a bummer. Some people have suggested, though, that as interest rates are poised to rise in the next little bit, much of the housing activity is going to occur now (oh, and also, before the HST kicks in, at least for new builds!), and maybe prices will start to stabilize a bit after the summer.
What do you think? Speculation and conjecture is most welcome!
If we had solid answers to this one, we'd all be out making a killing in the market rather than playing on our puters.
That said, the Bank of Canada has all but assured us that interest rates are going to rise sometime this summer. Whether that rise is enough to put a damper on financing remains to be seen, but I doubt it will have much impact.
The federal government also recently enacted tougher qualification standards for obtaining a mortgage. That said, the threshold is still pretty attainable and the regulations don't affect private lenders.
You're looking to buy in a very high demand area; unless the economy goes entirely into the toilet, prices in the GTA are going to remain ridiculous.
Hah, well, no minimum thresholds for accuracy in responding! Obviously none of us "know" - it's honestly just a thought exercise. I feel really out of the loop with the Canadian housing market and I have to say that it is SO different from what I'm used to here in the U.S. I mean, obviously, most of Canada was never as inflated, bubble-wise, and so hasn't experienced as severe a crash, but even just fundamental things.
Like, how is it that the cost of housing is so "off" from the average salaries? Or at least it seems that way. Maybe I'm wrong. I live in New York City right now and to move to Canada and do pretty much precisely the work that I do now there, it'll be a minimum $60,000-$100,000 pay cut. Fine, whatever. But I'm not getting much of a break when it comes to housing in the surrounding areas! And, moreover, when you take into account the fact that mortgage interest isn't tax deductible in Canada, it's kind of a double boo...it just makes the whole endeavor so much less affordable overall. And I am actually what is generally considered a "high" income earner, so I can't imagine how much harder it is for people who make less than I do.
Just for "funsies", take a look at the website "crackshackormansion.com". Some of the real estate going for over a million in Vancouver is simply astonishing.
Bubble? Bursting? In Canada? My money would go toward some sort of...how do the economists put it..."correction" in the near future, but hey, what do I know? Apparently, living at or beyond your means is more of a "south of the 49th parallel" thing.
Alright, well I am fairly into the real estate market. My dads a banker and we also work in the real estate market, "flipping homes." The housing market in Canada is actually really stable and people can afford the homes their buying. A couple reasons for that. One is our mortgage rules. How many years your mortgage lasts and the minimal down payment needed is regulated by the banking industry/ govt, so people who cant afford the homes dont get mortgages to buy them. Also a large number, around 75% if i recall correctly of homeowners in the GTA have paid off a good portion of their mortgages, Canadians tend to be more conservative in their buying habits, only buying homes they can afford, etc.
Aka, dont expect prices to go down very much, if at all.
I've noticed the prices in Kelowna have started to skyrocket similarily to Vancouver with how they build luxury condos and houses. Woo I'm glad I don't live there because it wouldn't take long for me not to be able to afford my home.
Well, there's an interesting thought...would the only reason for a "correction" be that people could no longer afford their homes, or a rise in foreclosures? This is of course one of the major factors in the U.S. market but isn't the real estate market in general cyclical?
Funny you mention the mortgage rules in Canada too...am I right in that these have recently been revised? Because I'm fairly certain that I've heard Canadian friends talk about no-money-down mortgages. In my case, because I'm working in the U.S., I'm considered a "foreign investor" under Canadian mortgage rules and I have to put down 20% on my home, which, fine, whatever...but I am presuming that therefore that means that that's not the default rule and others can put down less. But overall, definitely, there appear to have been much larger cultural and legal differences between Canada and the U.S., at least pre-2007ish. We were going to buy a house here in the NYC area and my eyes were like saucers when I first learned what we could be approved for (we made a combined income of around $200k back then and we were instantly approved for over $1m). I am so thankful we never went ahead with a purchase back then!
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