All Economic Data being made available in the past few months has indicated a strong economic recovery for the Canadian Economy.
- Canadian Consumer Bankruptcy filings fell 8.7% in December from November. In fact bankruptcy filings were even down from their December 2008 levels by 1%. Given that traditionally December is the biggest crunch time for people primarily driven by the expenses of the holiday season, an actual decline in bankruptcy filings in what is normally the hardest month for folks is a welcome sign.
- Canada's biggest customer to the south has had a tougher time making it out of its recession. However recent data suggests that the economy has definitely bottomed out and is looking to start reversing the trend. This is great news for Canada. Not only is the domestic economy propping itself up, soon our biggest customer will also begin its healing process - driving an increase in Canadian exports and job generation.
- The number of homes sold in February is up 44% from last year and driven by low inventory of homes on the market, house prices have continued to appreciate posting an increase of 18.2% from 2009.
What does this mean in terms of Residential Real Estate?
- Housing prices are going to rise as a larger number of buyers will enter the market with the stabilizing economy. The residential home market is still serviced by a reduced number of sellers with almost all listings going to Multiple Offers**!!
From the Globe and Mail today:
"You still see a supply shortage in the big centres because the people who need to sell and move up just don't see anything they want to buy," said Phil Soper, president of Royal LePage.
The average price of all homes sold on the Multiple Listings Service in February was $335,655, up 18.2 per cent from a year ago. The relentlessly strong price gains since last year's lows have fuelled worry about the formation of an asset bubble.
Finance Minister Jim Flaherty is watching the country's mortgage market carefully but does not believe there is a housing bubble, he said in an interview with Bloomberg.
Anything that helps prices stabilize would be a welcome development for policy makers, who are taking steps to make it more difficult to qualify for a mortgage in a bid to cool off the market.
Timing is Key. You want you home to be a winner in the market before the Government regulators start tightening credit and making it harder for individuals to get a mortgage. I foresee many potential deals falling through after being 'Sold Conditional*' once the new rules are implemented.
If you are curious about where your home value stands in today's conditions, give me a call and I will be happy to walk you through the value of your home in the current economic climate.
*Sold Conditional: When the Buyer is not pre-approved for a mortgage and is required to obtain financing after the offer has been accepted by the seller.
**Multiple Offers: More than one Buyer puts an offer to purchase a listed property