The March of every year is traditionally a good start for a yearly price spike. Last year, a large number of sellers who listed their properties on MLS didn’t receive the price they expected. The plan was to take it off the market and relist it during the market of spring 2019. We should except a reasonably high number of new listings in the coming month.
The anticipated prognosis for this year is a moderate increase in property price. As usual, prime locations may see a bigger increase of 5% and higher, while other areas such as Oakville, Mississauga and Burlington will see a very mild price increase. The interesting fact is, there are higher than normal interest rates for cheaper condominiums. Buyers attempt to buy smaller units in newer buddings. If you calculate the price per square footage of a 2 bedroom and larger unit, you will see the price per square foot is much lower than for a smaller unit. Nevertheless, they don’t drive as much interest from the buyer as a smaller unit. The reason is very simple - it is difficult to get a mortgage approval for a bigger unit in the range of $600,000+ and buyers settle with something they can afford.
In my opinion, this spring will be a good opportunity for serious buyers to purchase a good, reasonably-priced detached or a semi-detached house in a desirable location in the GTA. For those sellers who are thinking to sell their property for a record high price this season, it will be a disappointed time and they may need to take it down from the market again and wait another year or so. For those sellers who priced their property well with the proper assessment and appraisal with the right market price, it will be no problem to sell it within one month. When they sell their house, there will be a sufficient supply of new reasonably-priced houses in almost all areas.
The mortgage rates will be unchanged or have very little change as any more than very little changes will shake the market and economy. It is not in anybody’s interest in the coming on October 21st Canadian Federal election campaign.
Some other external factors may affect real estate market, such as potential possibilities of Prime Minister Justin Trudeau's resignation following Jody Wilson-Raybould’s Wednesday testimony.
The rumors are also circulating of the possibilities the government will be softening the recently adapted strict mortgage policy affecting the market and causing a current freeze. However, we don’t think the government will interfere at this pint, unless a serious correction happens.