The 2015 Real Estate Market Forecast: Slow, Steady and Still Rising
Wednesday Dec 31st, 2014
As professional and knowledgeable as I am, as a Real Estate Agent , I still don’t have the proverbial “Real Estate Agent’s” crystal ball. However, here is the most supported 2015 Real Estate Market Forecast.
We’ve just seen a large oil price slump which may or may not have an impact on the real estate market, however the biggest unknown factor is whether interest rates will rise or not.
Some economists predict that Ottawa will delay any interest rate hikes because of this recent oil situation. Since mid-summer 2014 oil prices have decreased 35% due to the strength of the U.S. dollar, less demand and a global over-supply. However, unless low oil prices continue for a sustained time period there won’t be much of an effect on our real estate market. We need to remember, too, that even if there is a small rise in interest rates, they will still be at record lows.
Toronto Real Estate prices in 2015 are forecasted to rise another 4% from 2014, while the average across Canada has been only about 2.5%. “Slow and steady” Toronto real estate price increases are the prediction if the number of listings still outpaces Buyer demand. 2014 saw a “Seller’s Market” throughout the year because of such low residential inventory. This resulted in a tabulated GTA 8.3% price increase but, more in Toronto’s coveted areas.
With my expertise as a Real Estate Agent, I know that homes in the most prime locations, near the best schools, close to transportation and in desired ‘community’ neighbourhoods will always command a higher price. And that won’t ever change.
One of the factors to consider for the Toronto real estate market is the recent election of Mayor John Tory. As he continues to provide greater stability, this bodes well for our city’s real estate market. Second, with interest rates staying low, there will likely be a rush to lock in mortgages before a rise. I recommend talking with me about refinancing your existing mortgage because the penalty cost could well be offset by locking in a new 5 year mortgage at a rate lower than you currently have. In 2014, many of my clients have done and, by doing so, have been very successful in saving money.
And third, the Pan Am Games ‘may’ impact even greater Buyer demand and push real estate sales and prices, but this one remains to be seen. And ‘if ‘ it does happen, at all, it would prove itself only towards the end of the year. Fourth is that as condos go up, condos are selling – predominantly (73%) to Buyers who can’t find houses, but still want to own a home – but also to investors who see the long term real estate value in being able to easily rent them out. The challenge with this is whether their Tenants will keep them in good condition so that their market value doesn’t decrease.
With continuing Canadian economic growth, the record low interest rates, and the steady immigration of new Canadians purchasing homes soon after their arrival, the real estate market is on solid footing for 2015.
Forecast for the rest of Canada:
Montreal +1%, Quebec City +1.5%, Winnipeg/Saskatoon no rise, Regina +4%, Edmonton +4%, Calgary +3%, Vancouver +3%,. The largest price increases are predicted in Moncton with +6% and Kelowna with +7%.
Recognized in the top 1% of all Toronto Real Estate Board's sales and properties sold in 2012-2014, Nancy Biderman is a respected Toronto Real Estate Agent providing extraordinary Full Service. Nancy has over 15 years of trusted Real Estate expertise. Her integrity, dedication to her clients' financial goals and overwhelming success is consistently reward with repeat clientele and referrals to their friends, families and associates. Nancy has also been awarded the Harvey Kalles Real Estate Ltd., Director's Circle accolade from 2000-2014.