Friday, January 06, 2012

Will 2012 be a great time to buy?

Despite the crisis in global financial markets, talks of a Canadian housing bubble and reports that debt loads are too high in relation to income, the Canadian housing market was remarkably resilient through 2011. The country’s economy actually grew in the past year, thanks to the addition of more than 200,000 jobs and slows but steady GDP growth.

And according to ReMax’s Annual Housing Market Outlook published in December, the housing sales market in 2012 should be slightly better than last year with an estimated 460,000 properties expected to be sold compared to 447,000 properties sold in 2011. The reason for this, according the report, is low interest rates along with tight inventory levels and increased urban demand.

This is good news for buyers and sellers. Most of the markets across Canada are predicting an increase in the average property price as well as a slight increase in the number of properties that will be sold. Major centres like Saskatoon, Calgary, Winnipeg, Sudbury, and Hamilton-Burlington all boasted big numbers, with year-over-year gains of between 8% and 13%. The markets in Calgary and Saskatoon are expected to continue to lead the country in sales and the GTA, Moncton, and Regina are also projected to perform well with anticipated gains of 3% each.

The biggest winners will be first-time buyers and move-up buyers. Move-up buyers will benefit from a combination of increased house prices and low interest rates, which will continue to attract a higher number of potential buyers.  And as cities continue to improve their downtowns and pump money into redevelopment programs, living in these urban hubs will attract first time buyers who will put pressure on developers to build affordable accommodation to suit this lifestyle.

So, will 2012 be a great year to buy? The relatively low interest rates, which will likely be here for some time – at least into the latter part of 2012, will continue to attract first time buyers as well as investors. For more information about the housing market, contact your mortgage professional.

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