Forecasting the weather or anything else is always tricky and residential real estate sales in Kitchener-Waterloo are no exception. My predictions for 2009 were for a buyer's market by spring, MLS sales of 3725 properties and declining prices of 10-15%. As detailed in my previous post, thankfully none of this came to pass due to government stimulus and low interest rates. An outstanding decade of real estate sales in Kitchener-Waterloo closed with a flourish.
As we enter the New Year, we have a strong seller's market with low inventory and high demand. My forecast for 2010 is for a return to a more traditional market. In years past, 2/3 of the buying and selling was done between January and June. This past year, the first quarter was unusually slow and the fourth quarter saw record sales for the Kitchener-Waterloo Real Estate Board. I anticipate strong early demand due to expected interest rate hikes by the Bank of Canada and a rush to beat the introduction of the Harmonized Sales Tax in Ontario. The Canadian Imperial Bank of Commerce recently suggested that Canada is likely to end government stimulus too soon and weaker economic activity by year's end will result. http://tinyurl.com/ykpa26u
I look for 2010 residential real estate sales in Kitchener-Waterloo to total 4100 sales(a decline of approx. 18%). I expect prices to increase through the spring market and give back the gains in the summer and fall. By year's end, I anticipate higher interest rates by .75% with discounted 5 year mortgages in the 4.75-5% range.
My next post will examine recent Power of Sale activity in the K-W market.
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