With the stock markets bouncing around and issues with the the US subprime mortgage rates, no wonder the public is contemplating the question "When is it going to burst?" Quite frankly I believe the sky isn't falling and our Canadian real estate market will continue to be a solid investment.
In Parry Sound, there is a 0% vacancy rate in rental accomodation and homes are at an all time high with few signs of price reductions. Recreational properties are still in high demand even though some of the products are a little overpriced. The bottom line on waterfront properties is that they don't make any more of them (with the exception of severances) so it is a matter of supply and demand and the demand is still high.
The following recent newsreleases provide additional support for my market beliefs. If you would lke to discuss real estste acquisions or sales please feel free to email me at email@example.com or call me at the office at 1-800-536-5807 or on my cell at 1-705-774-0955.
Gord Pollock, Broker, Century 21 Granite Realty Ltd. Brokerage. 33 James Street, Parry Sound, Ontario P2A 1T6.
The Canadian Real Estate Association recently issued the attached news release to provide a dose of "economic reality" about the housing market in Canada.
Canadian residential real estate future is solid
OTTAWA - January 23, 2008 - The Canadian housing market in 2007 set a
number of MLS® sales records, and the re-sale housing market is expected to
remain at near record sales levels in 2008, according to The Canadian Real
Annual residential MLS® sales activity totaled 520,747 units in 2007, up 7.6 per
cent from 2006 levels. This was the largest annual sales growth since 2002, and
the first time transactions via the MLS® systems of real estate boards in Canada
have surpassed 500,000 units sold in one year.
"The results in 2007 show the strength and the affordability of the Canadian
residential market," says CREA President Ann Bosley. "The statistics again show
just how different the housing markets are in Canada and the United States.
Canadian REALTORS® know that Canadian mortgage lenders correctly see that
home prices will continue rising. We know there is still strong competition for
mortgage business in Canada."
Three key economic ingredients will keep Canada's housing market on a
different track from the United States. One is consumer confidence, the second is
employment, and third is affordable interest rates. The Bank of Canada cut
interest rates on January 22nd because of weaker prospects for Canadian
economic growth in 2008. "Those lower interest rates will also help temper the
erosion in housing affordability due to additional home price increases," Bosley
added. The Bank of Canada is expected to cut its trend-setting rate again in
CREA's Chief Economist Gregory Klump says that the Canadian housing market
in 2008 will pull back from the breakneck pace set in 2007, but this is still forecast
to be the second-busiest year on record in almost all provinces, with residential
unit sales reaching an estimated 512,705 units.
Average prices for MLS® home sales are expected to keep setting records in
2008, although prices will increase more slowly as the market becomes more
balanced. In most provinces, the market will nevertheless remain historically tight
- with the tightest markets being in Saskatchewan and Manitoba. Nationwide, the
average residential price is forecast to increase 5.5 per cent to about $322,700.
According to CREA's Chief Economist, a larger supply of listings will be one of
the balancing influences in 2008. New listings are forecast to rise in all provinces
except Alberta, where they're expected to retreat after spiking in late 2007.
"The challenge for the Canadian housing market will be the extent to which
employment and consumer confidence may be affected by a slowdown in the
U.S. economy," Ann Bosley adds.
"Slower job growth, not massive layoffs, are forecast for Canada in 2008,"
CREA's Chief Economist Gregory Klump adds. "Consumer confidence may be
sideswiped by stock market volatility, and reports that chances of a U.S.
economic recession will put the brakes on the Canadian economy. With slower
job growth, a low unemployment rate and the absence of widespread layoffs,
consumer confidence will bounce back. The domestic economy and the housing
market will weather the sub-prime fallout with the help of lower interest rates".
- 30 -
For more information please contact:
Bob Linney, CREA Communications Director, at 613-301-2219 or firstname.lastname@example.org
Gregory Klump, CREA Chief Economist, at 613-237-7111 or email@example.com