2014 outlook for Canadian housing market good as sales and prices reach new records
The number of homes sold in Canada this year is expected to match or exceed 2012 levels in two thirds of markets with nationally sales reaching a five year high, according to the latest outlook report.
The price of an average Canadian home is forecast to climb to $380,000, also a new record, says the RE/MAX Housing Market Outlook 2014 which examined trends and developments in 25 major centres across the country.
‘Housing values have been incredibly stable this year, propped up by relatively balanced market conditions. Ontario-Atlantic Canada markets showed steady price appreciation throughout the year, with Hamilton-Burlington, Barrie and District, St. John’s and the Greater Toronto Area all reporting increases of 5% or more in 2013,’ said Gurinder Sandhu, executive vice president and regional director RE/MAX Ontario-Atlantic Canada.
He pointed out that while the national picture has been quite rosy in terms of sales activity, the regional performance has been more varied, particularly in Atlantic Canada and although East Coast sales have softened over last year’s level the region is poised for future growth.
‘Solid economic performance, low interest rates, and rising consumer confidence will all factor into next year’s outlook. The momentum that emerged in most residential housing markets in the final half of 2013 is expected to spill over into 2014,’ explained Sandhu.
‘Sales and average price are on an upward trajectory, with the number of homes changing hands across Canada forecast to climb to 475,000, while average price is expected to edge higher, settling at $390,000 by the end of 2014,’ he added.
The report predicts that Halifax-Dartmouth is expected to lead in terms of percentage increases in projected housing sales. Hamilton-Burlington, Barrie and District, Kingston and Area, and Windsor-Essex are expected to round out the top five performances in Ontario-Atlantic Canada.
The Greater Toronto Area is expected to lead the country in terms of percentage increase in average price, followed by St. John’s, Hamilton-Burlington, Kingston and Area, and Windsor-Essex.
‘The framework is now in place to support steady and sustainable growth in Canadian housing markets over the next few years. After several rounds of mortgage tightening, buyers are more realistic in their pursuits. Most are coming to the table better qualified than ever before. Given underlying fundamentals, the future looks bright for residential real estate in Canada,’ said Sandhu.
‘Canadian home buyers remain savvy with a long term mindset that bodes well for stability. Yet, they also value progress, and we expect that to translate again in 2014. Equity gains should continue to result in tangible leaps to larger homes or better neighbourhoods, as well as a growing wave of renovation and revitalization. Stock market performance is also expected to bolster activity, as paper wealth is converted to material wealth,’ he added.