Experts are predicting an air of optimism for the Canada real estate market in 2019 as per recent reports. The mortgage stress test was of course a major decision which impacted the real estate market in the country last year. Most home buyers had to qualify for the mortgage at rates which were higher than the contracted rate in order to see whether they could repay their debt in case rates went up suddenly. Several buyers also bought homes in 2017 in order to avoid taking this test. More than 46, 000 homes were sold throughout Canada in December 2017 alone. Housing transactions also came down by roughly 14% in January 2018 thereafter.
Several regional housing markets were impacted by the mortgage stress test including the Greater Toronto Area or GTA which had sales figures slightly lower than those witnessed in 2017. However, throughout the country, housing prices (adjusted for inflation) have majorly remained on the flatter side ever since Q2 2017. This is attributed to the slump in housing markets in Ontario previously, particularly after new taxes were imposed by the province on foreign property buyers in April 2017.
Yet, housing markets have been picking up a little in Toronto and other parts of the GTA along with markets like Montreal. 2019 should witness moderate growth in both sales figures and prices and hence the forecast is largely optimistic on account of no major economic fluctuations, steady job creation and economic growth and other factors. CMHC (Canada Mortgage and Housing Corporation) is expecting housing prices to be largely in sync with economic conditions and hence with employment levels, household incomes and overall growth in population expected to go up, the real estate market should keep growing in Canada.
Sales volumes could be slightly lower than 500, 000 units for 2019 as per the CMHC forecast. Average home prices may also hover slightly lower than $525, 000 in Canada as per the CMHC. There may be further moderation in housing markets in B.C. as per the organization. However, Montreal may see housing market and price growth due to an influx of more foreign homebuyers this year.