Canadian real estate market – The real estate market in Canada has experienced a significant surge this summer by witnessing a strong increase in real estate sales transactions.
With the summers being quite favourable this year across the country, real estate buyers in Canada have been keen in making significant real estate investments throughout Canada.
Real estate sales up across Canada
A recent study report by CREA revealed that Canadian real estate sales were up by as much as 24% in Toronto, 15% rise in Montreal & Ottawa, upwards by 8% in Calgary and upwards by 12% in Edmonton (and notably 18 percent increase in single family homes). The sleepy giant, Vancouver, experienced an increase of 23% in real estate sales in July 2019.
Given such impressive figures, it was concluded that the real estate market in Canada during July 2019 was way better in comparison to that of the last year. When it comes to the overall status of real estate purchases in Canada, it has been observed that single-family home sales have increased exponentially this year – with Toronto going upward and Edmonton experiencing an 18 percent surge while there is a rise of around 31 percent sales in Vancouver.
In addition to single-family home sales, the market for Vancouver condos for sale is also surging significantly by as much as 15 percent.
The total supply of real estate listings for condos in Canada is also lower in comparison to the last year figure. This is the case for all types of condos, from 1 bedroom condos, 2 bedroom condos and up to 4 bedroom condos.
Additionally, there is a revolving rumour that this fall, that the Canadian banks are likely to put pressure on some of the real estate developers to sell their pre-sale units.
Real estate market conditions across Canada
Various study reports have revealed that the entire Canadian real estate market has strengthened significantly with high-end condos and houses gradually getting the attention of real estate investors.
However, with a myriad of negative factors like negative interest rates, trade wars, gradual global growth, increased geopolitical risks, violent protests in major parts of the world including Hong Kong, Iran, Turkey, and over Brexit, and so on, some pundits still fear that there maybe some trouble ahead as the bond market is showing an inverted yield curve (can be a recession signal).
Despite the great news across Canada, the real estate market may still experience phases of uncertainties, periods of volatility, and confusing restrictions by the Canadian government (ie mortgage stress test) before resuming the upward ride in the market again.
Timing your property purchase
As far as the panacea to the field of real estate investment is concerned, everyone trumpets the importance of location, location, location in the industry.
However, homebuyers that have experienced the best return on their property investment have always benefited most by observing the latest trends and timing the real estate market. Timing is primordial and takes precedence over location for those buyers who experienced the best returns on their purchases. Homeowners with the greatest returns time their purchases during down markets.
Timing is a double edged sword that must be carefully weighed
For instance in Western Canada, the condos located in Vancouver Downtown False Creek dropped in the overall value by as much as 35 percent from the period of 1992 to 1997 – even at the finest location.
During the period of 1986, if you had bought a house in any location of Toronto, San Diego, or New York, and sold the same in 1989, it would have made you earn as much as 60 percent of profits.
At the same time, buying the same house or property in the given real estate market during 1989, and then selling the same in 1994 would have made you incur a loss at around 35 percent.
If you had bought a Vancouver home back in the year 1994, and sold it in 2000, you could have experienced a surge of around 45 percent in the residential market.
Quite recently, if you bought a house in the United States of America in 2004, then it would have observed a surge by as much as 32 percent during 2006. The loss was by over around 60 percent by the time 2011 came around. If you went forward with buying a house in the United States during 2012, you could experience a whopping increase by around 200-300 percent.
Timing in real estate is the key factor for the successful Canadian homebuyer
Unlike the stock market, real estate markets tend to be always local in nature. Therefore, the market tends to fluctuate with the confidence level of potential buyers in the given market. As far as the loss in value of the property was concerned, the location of the place did not play a vital role.
It does not matter what location you will be buying, you can end up making money in any given location when you made the investment at the right time in the given Canadian real estate cycle. It seems that the residential market has picked up strong sales volume across Canada in July 2019. If you have been waiting on the sidelines, could this be your buy signal?
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