Ever since the covid 19 pandemic began we have seen people retreat to there homes as new layers of lockdowns are being imposed on people. Living in your home and not going out can be tough for most people. This has most certainly caused a shift in demand for tight condos to bigger more spacious living arrangements.
I mean if you are going to live your house protected you ought to think in term of long-term benefits as well. Therefore, the demand and the retail price of the whole market are screaming at the top of there lungs.
Initially when the march lock down began, we saw a dip in the market and well that was quick to sprung back up when the market was relax by letting ease of the social distancing protocol. That would allow for dealing to be carried out in a much cleaner fashion.
This resulted in an aggressive month for trading for the months of July- September Last year.
The Rental Market of Canada;
The rental market is beginning to play a role in the housing market as well. We have seen rents go down in the Toronto area which is the Canadas largest and least affordable city. It is important to understand that renters tend to earn less than home owners and after the corona pandemic things are not looking good in the job market as well. Therefore, a lot of people are skipping up on the heavy rents and shifting to alternative means hence reducing the demand of an already established market.
Selling out Condos:
The condo investor is looking to sell. Keeping mind, the size of condos and the new space requirements brought about by the pandemic condos are going out. While most people now are shifting towards the cottage country. To look for more larger spaces to live in.
Meantime, affordability issues are driving many Canadians further afield into smaller towns and cottage country, where larger living spaces are available. Clearly COVID-19 has lit a fire under cottage country real estate.
Bank of Canada Cutting Rates Over Night:
More or less, we cannot ignore a simple fact. That the covid 19 has allowed people to own new homes. And has made this very easy. With the Bank of Canada’s overnight rate cut to close to zero and sharp declines in bond yields mortgage rates have been pushed to their lowest levels on record. This slightly reduced mortgage payments on a home priced at market value despite prices continuing to rise at an accelerating pace in most of Canada. Generous government income support programs for households most affected by COVID-19 also made it easier to carry mortgage payments.
Immigration has Fallen:
We have seen the level of immigrations have fallen and this means that there would be less people generating demand for houses and accommodations in general. Which would show into the impact on price of a relatively lower demand. Meaning this would be looking great of the people who are planning on buying.
And well not as good for people looking into selling. With income being impacted by the virus as well. I would say that is going to put people in a position to put out there assets quickly to generate cashflows.
The home owners are expected to wait and watch this pass by if they can. That is.
