2022 Housing Outlook & Immigration
As mentioned before, the Real Estate Market is ever evolving and forever changing. Despite no one having all the answers, we are able to look at the historical sales activity, market trends and data to make calculated guesses for the future.
A few trends to watch in the market to watch are:
Interest Rates are Expected to Rise
We may begin to see interest rates on the rise as early as April. The 6 big banks in Canada have all predicted that the Bank of Canada will raise their overnight rate by 1% by the end of 2022. This will be the first movement by the Bank of Canada, following a trio of rate cuts in March 2020, prompted by the pandemic and the ensuing economic impacts. With that being said, only time will tell the impact that this will have on the market. I believe that given current levels of supply and demand, a one-per-cent hike is unlikely to be a significant factor on sales or prices.
Prices will Likely also Rise
From a National perspective, the average residential price is expected to increase by 9.2 per cent. Currently, supply remains at an all time low and will likely continue to get worse. With no major attention given to increasing supply on the purchase side or the rent side, this will put great strain on home prices and on options for buyers/renters. Canada recently announced a plan to bring in more than 1.2 million immigrants over the next three years which will also greatly affect the need for homes.
Virtual Deals are the Future
Virtual Home-Buying and Selling isn’t just a temporary trend that carried us through the pandemic lockdowns. With the internet bringing listings right to your fingertips, and virtual tours offering opportunities to view a home without ever leaving the comfort of your own home, to the ease of digital paperwork and offer. Now that consumers have had a taste of this sweet convenience and they’re unlikely to give it up when COVID-19 is behind us. It’s safe to say the virtual trend will be the new reality for many Buyers and Sellers.
The Real Estate Market has always been constantly changing, making no market like the last market. Trying to predict it has been futile. Mortgage stress tests, Covid-19, rising interest rates have all been thought to slow this market down, but all have failed and on goes our crazy sellers market. Even the job of a Realtor has changed dramatically. Large Brokerages (REMAX, Coldwell, Royal Lepage etc) no longer have the same level of service to agents as technology has replaced much of what they used to offer. Small Boutique Team Brokerages are becoming the future. Our day to day has changed, only 30mins allowed for a showing, home inspections are almost impossible to book, and determining how much to undervalue a home's market value in order to drive the most amount of offers. These are all new problems and new jobs are needed to be tackled head first. A dynamic career is why I got into Real Estate 8 years ago. I’m excited to continue adapting and growing with the market as well as the technology to best deliver a positive experience with my clients.
