Glynis' Market Snippets: August Edition

In August I attended Sotheby’s International Realty Canada’s first Canadian conference in Montreal. Under the leadership of President, Brad Henderson, the brand in Canada goes from strength to strength. It was an excellent opportunity for me to connect with my colleagues across the country and some from the U.S. We were able to share market information and best practices and I have come back with a renewed respect for the brand that I have chosen to represent my listings.

In and around Victoria, construction continues at a rapid rate. The West Shore building boom is most noticeable where they are building rental apartments, condominiums and single-family houses. In the first seven months of this year, 911 housing units were started in Langford, far outpacing other Greater Victoria municipalities. According to Canada Mortgage and Housing Corp’s latest report, 2,185 homes were started in the capital region in 2018, up from 1,913 for the same seven months in 2017.

Statistics from the Canadian Real Estate Association (CREA) indicate that the Canadian housing market is also finding its footing after a prolonged stumble in the first half of the year, shaking off the impact of stricter mortgage rules, rising interest rates and provincial policy changes.

In July 2018, statistical data from CREA shows that the Greater Toronto Area sales climbed 7.7% from June and 17.6% year over year. Toronto colleagues at the Sotheby’s Conference confirmed this anecdotally.

"Essentially, stabilization in the Toronto region has been offset by a pullback in other areas, notably much of Western Canada," said BMO Financial Group chief economist Douglas Porter.

Bank of Canada Governor, Stephen Poloz, has signalled more rate increases will be necessary over time thanks to the economy’s resilience, but he has stressed that the process will be gradual. The federal finance department has explored factors such as income, age and region in an effort to pinpoint the types of households that will be most affected by the central bank’s ongoing rate-hiking trajectory, which follows years of extremely low interest rates. The conclusion was that younger, middle income households will be among those that feel the biggest financial sting.