The Canadian real estate market is slowly coming out of a brazen attack by an invisible virus, with real estate activity picking up in many regions across Canada. Canada’s real estate community lost a colossal business opportunity from its red-hot spring real estate market just before the pandemic landed on its shores.
When the pandemic was announced in Canada, real estate activity plummeted drastically as social distancing etiquettes were enforced, open houses cancelled, and fewer listings were available. A pall of gloom hung upon real estate agents as their hope of making a good buck were dashed into pieces.
Three months on, Canada’s real estate market is stable-sales and listings have doubled, open houses are on a roll with strict safety precautions, and prices of real estate properties have stabled. Bidding wars have started, through consumer sentiments haven’t peaked to a healthy level.
According to the Canada Mortgage and Housing Corporation (CMHC), real estate prices can fall between 9-18% this year, depending on demand and supply levels. And prices may not revert back to normal even by the end of 2022.
Though many buyers and sellers are dilly-dallying over whether they will step into the real estate market or not, markets in Toronto, Vancouver, Ottawa and Hamilton-Burlington have heated up. Fierce competitions for homes are raging on between buyers. In Edmonton and Fraser Valley however, buyers were at an advantage than sellers.
In this scenario, if you are looking to buy a home or put your house on the market, then you must know that the processes are completely different now. From digital walkthroughs and virtual tours to digital signatures and mortgage approvals, the home transaction process has worn a new garb.
Let’s have a lowdown on what the real estate market looks like these days.
The real estate market favours sellers: Canada witnessed a drop in properties listed for sale in the initial weeks of the pandemic. People were panic-stricken about people entering their homes to have a tour. As a result, properties vanished off listing platforms.
However, now prices have become steady despite sales falling significantly. In some places, prices have shown significant improvement and properties are selling like hotcakes. With restrictions loosening off, real estate activity has peaked. This has resulted in an uptick of listing on the market as city dwellers are looking for spacious homes owing to low-interest rates.
Virtual showings and strict protocols to stay: The scars of the pandemic are far from over. Open houses are still banned in many parts of Canada like Quebec and Ontario while others are following strict safety protocols.
Reliance on technology is ruling the roost as homebuyers are preferring virtual tours and digital transactions while shopping for homes. For adamant buyers, realtors are asking to sign a declaration of their health status and asking them to wear masks and gloves. Homes are also sanitized, and visitors are asked not to touch anything inside the property.
Covid clauses in purchase agreements: Homebuyers worried about losing a job or getting sick are asking to include COVID clauses in their purchase agreements. While this doesn’t affect the deal, the clauses come with different policies. For some buyers, the policies include a deep cleaning of the house by a reputed company before taking possession of the house.
Low mortgage rates favour buyers: The exceptionally low rates are a major draw for buyers looking to purchase a larger, recreational home. As far as mortgages are concerned, five-year, fixed-rate mortgages remain the most popular product choice in the market right now. The mortgage process has become digital and so is getting done more quickly than it was in the pre-covid era. Prospective homebuyers whose income have been affected by the pandemic can consult mortgage experts to work out a suitable mortgage option.