2018 didn’t bring much happiness to realtors in Toronto. As 2018 neared an end, real estate agents and experts started making their predictions on how the housing marketing will be like in Toronto in 2019. There were several lessons to learn from 2018 and we have jotted down some interesting guidelines that will help you understand the Toronto real estate market better.
Interest rates will continue to rise
The banks project an increase in the interest rates by 2.25-2.75% in 2019. Though the increase in the rate and the strict housing policies target at improving the quality of the mortgages (that have already been issued), the buyers as well as the housing market is going to face some difficulties. With interest rates going up, the same house is going to get more expensive. However, it does not mean that buyers should buy the next property they see; instead, they need to follow a measured approach while investing in real estate.
Sale prices to go up in 2019
Most economists expect the prices are expected to rise by 1.7 percent in 2019. This is because population and employment in the sector will continue to keep the housing market in demand. A real estate agent in Toronto might help buyers find a lower price, but buyers should still expect to pay higher prices than 2018. In fact, experts advise those who are planning to buy should buy as soon as possible because prices will rise continuously, although there will be no sharp hike in the prices.
Government will intervene
The government has been changing and tightening the mortgage rules for years and the intervention of the government is also expected for the year 2019. No doubt the government is doing so with the long-term goal of bringing the prices down, but the tightening of rules is becoming the reason of frustration for the buyers.
In 2018, the government applied a 2% stress test to the mortgages having a down payment of more than 20%. This was done to ensure that the borrowers would be able to handle an increase in the interest rates. And similar measures are expected in 2019. Even the City of Toronto has started to put restrictions on rentals.
Condo sales are expected to level off
Condo sales were hot in 2018 as they covered 37% of the total residential sales but the demand is expected to slow down in 2019. However, still, condos are going to be a major part of the Toronto real estate market as they are a preferred by immigrants over other types of residential properties. With a number of new condo developments nearing completion and plenty of projects on the way, the condo sales are expected to level off in 2019.
Whether it is the buyers, sellers or the real estate agents in Toronto, all need to take these facts and predictions into consideration while making any move. There is no need to fear the market; instead, you should plan your purchase or selling according to the ongoing trends.