The general consensus seems to be that the Canadian Real Estate Market is still one of the least disastrous markets worldwide. However, this doesn’t mean that this is a secure market. Sale prices are declining like everywhere else, and the current semblance of stability is only related to the fact that Canadian lenders and banks were, in previous times, much more conservative than lenders in other countries.
However, the market in Canada is by no means in the same state as it was a few years ago, which is obvious than when you look at a city like Vancouver, British Columbia. Vancouver had some of the most insanely hyper-inflated prices in the last few years, and so now that are fewer buyers, there are a distinct lack of properties being sold, and those that do sell, sell low.
On Friday in the Globe and Mail, Kerry Gold wrote an article misleadingly titled ‘First Time Buyers Drive a Rebounding Market” as it also talks about buyers who are upgrading, as well as those who are first time purchasers. One interesting point about this article, is the reminder that there are certain types of buyers who will always exist in any market, and will be the ones who will stop the it from going into complete cardiac arrest. This is, of course, as long as they are not completely scared off by the onslaught of negativity that currently invades the real estate market. Just joking:
1) First Time Buyers: If you are a first time buyer, this is a great time to get on the first rung of the ladder – but only if you are brave enough to take the plunge, and can get a mortgage. Prices are low, mortgage rates are low, and now with tax advantages ahoy, this is the best opportunity that you’ll get for a while!
2) Growing Families: When one’s family starts getting bigger, the need for more space necessitates the move to a bigger place. Last time I checked, people hadn’t stopped having children, and again, if you bought a while back, you’ll have equity in your property, and upgrading in a low market will not make much of a difference
3) Empty Nesters and other ‘downgraders’: At the other end of the scale, there are people downgrading. As long as one is moving within the same or a similar market, downgrading is not a big problem, as the gap between your lower priced large home, and your lower priced small home should be pretty similar.
4) People who are Relocating: When the job market is not secure, people will move where the jobs are, so this market is almost certain to generate a good deal of relocation. As this is born out of necessity, these people buy and sell in any market!
While this is not entirely newsworthy, it is worth remembering that these kinds of buyers exist in every market, so whatever the economy situation, there will still be these kinds of buyers to keep things going. Think of them like the superman of buyers...come to save us all from certain disaster. Which in the current bad news market is a little piece of good news. Shock horror, eh?