A lot has been happening in the market over the last couple weeks and I'm often asked what I've noticed and where I think its going so I figured I might as well put it out there for everyone to read. Now I will say right off the bat that this is strictly my opinion and my own observations and there is absolutely no way to predict what will happen in the future.
So, on April 20th, the Wynne government put in place 16 sanctions to try to cool this overheated market and make housing more affordable for everyone. Now did these solve the specific issues that cause this inflation? My opinion, not at all. Did it have an effect? Surprisingly, maybe. But I feel that this has more so to do with the media spinning this as the start of the end than anything. The major issues the government addressed were Foreign Buyers buying up the market, taking money out of Canadian economy and back to their own countries. I agree that this should be curbed, but at representing less than 5% of all sales in Toronto, its not even remotely close to as big as a factor as it was in Vancouver. The rest of the imposed sanctions are to do with rent control and other things that have no immediate effect on the market.
Now, if anyone is following the market you will have realized that the bidding wars are far less common as they were three weeks ago and it makes sense why. We are in the busiest time of the year, where people have been getting their homes ready for months for the spring/summer market. Now we have hit that mark and listings have been flooding the market. This, topped with the media constantly spitting out that the bubble is about to burst, have made many people think they they can sell while its still high but its having a countering effect. Buyers now have a variety of viable options and some are deciding to sit back and wait for the prices to fall. They're not. Homes are being listed as high as they were months ago when they had almost no competition. Homes are still selling, usually still over asking but when it used to go on offer night in a bidding war, now it seems like they'll sell anywhere from 7-35 days on market. Homes that are holding offers are now few and far between.
Where is this going? Really? Who knows. In my opinion I don't think that the sky is falling, I don't think the bubble is bursting. Nothing aside from supply finally starting to meet demand has really happened. Even though this has had a slowing effect on the market, listing prices are still very high and they are eventually selling for those prices. I believe that once these homes sell and we get into the heart of summer where supply starts to decrease, demand will be just as high as before and we could be right back to where we were a month ago.
For the sake of everyone, I hope I'm wrong and that we have had the correction that will make housing more affordable for everyone again but I guess only time will tell.
Thanks for reading! If you have any questions about anything, please don't hesitate to reach out to me!