In case you are concerned regarding the media warnings of the “bubble” bursting in what’s generally known as “The Canadian Housing Market.” I ask you: What precisely is a “Canadian Real Estate Marketplace?” States, cities, towns, and even neighbourhoods all differ. Real Estate costs in Vancouver, BC are extremely distinct than in Windsor, ON. Both cities are Canadian but they have about a $700,000 difference in average home prices. Real estate growth in King City, ON is considerably different than Toronto East (yet they’re just 45 minutes apart). With changes so vast within such much little geographic locations how can the media summarize all real estate activity in one group (The Entire Nation)?
My personal and professional belief is that a microeconomic strategy is a much safer way to understand the true inherent real estate activity as it pertains to realistic purchases and actions. Unless you’re a world-wide investor comparing Canada to the rest of the world, then it will not do much good to review data on Canadian marketplace activity as a whole. Even if you’re a international investor, it is far better pinpoint a few locales and research their performance independently rather than collectively.
So, then what’s this market and when will it burst? The answer to that is unfortunately NO ONE KNOWS. We have been learning about this for the better part of 5 years yet we have yet to see it. Interest rates continue to be steady and for the first time in modern Canadian history three leading banks have offered the lowest fixed mortgage rates ever (2.99%).
With low interest rates and also a booming immigration system bringing in the best mix of subscribers to our economy, real estate is a great investment (provided folks are willing to hold on if the market dwindles a little). The inquiry is how long must people hold on? Whether or not people wish to consider it, we (Canadians) will likely not experience the same home fiasco our buddies in the US experienced. Additional information can be located about Eddie Yan here. Even if we use this microeconomic strategy for a US home operation evaluation, we’ll find that not all US cities have experienced this significant downturn and that many cities weren’t strike very hard and are rallying fairly well. Once again, an all encompassing categorization of real estate functionality by nation does not even apply to the current US catastrophe. Therefore, how can it be used to evaluate a much more fiscally average and culturally diverse country like Canada?