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Ontario Home Prices To Trend Higher In 2010
Ontario Home Prices To Trend Higher In 2010
Cautious optimism is on the lips of many Real Estate agents and economists. Though the last 12-18 months has definitely held some uncertainty in the housing market, the future is looking much brighter for the Ontario home market.
Toronto,
Ontario,
Canada
(prbd.net)
13/01/2010
"Cautious optimism is on the lips of many Real Estate agents and economists. Though the last 12-18 months has definitely held some uncertainty in the housing market, the future is looking much brighter for the Ontario home market."
Ontario Canada - Canada and more specifically Ontario appears to have avoided any lasting impact from the collapse of the US housing market and the subprime mortgage market meltdown. What we have seen over the past 18 months was fear versus demand and fair market values relative to the true economic environment in Ontario. From the price stability we have seen, I would say we are on great footing going forward.
The rational for Ontario home price appreciation in 2010 is as follows:
Ontario home prices are fairly valued. Despite a healthy appreciation in home prices in Ontario between 2001-2009 we have avoided the huge run ups (and drops) in prices seen in Alberta and British Columbia.
Ontario’s housing supply appears to be inline or undersupplied versus the demand.
The 40 billion dollar economic stimulus package Canada has added to its current 507 billion dollar national debt represents approximately 8.5% in new debt. While this is bad news for most tax payers, borrowing at this level will definitely cause price inflation. This will directly and positively affect the value of real estate.
The world economy appears to be stable or growing. Despite a US collapse, China’s GDP growth rate for 2009 is estimated to be around 8.2% and is forecasted to be in the 8%-9% range for 2010. India grew at a rate of 7.9% over 2009 and expects a 7% growth rate in 2010. Canada benefits directly from rising demand of natural resources, if the demand continues, this will be sure to have a further positive impact on the Canadian economy.
The unemployment rate in Ontario rose sharply as a result of the US economic collapse. However, it has since started to slowly decline. The unemployment rate currently sits around 8.5%, it averaged around 6.2% during the 36 months of 2006-2008.
Ontario continues to have a net gain in population growth. It is estimated that the population of Ontario will grow between 6% and 10% over the next 21 years. This will have a longer lasting and direct impact on both the demand for housing as well as the economic activity in the area.
Improving consumer confidence and record low interest rates are bound to have a positive impact on the spring 2010 housing market. The spring housing market may even be exaggerated by the Bank of Canada’s signaling of their intention to raise interest rates in June and the introduction of the HST on new home purchases in July.
Where prices go beyond the summer of 2010 will really depend on how much and how quickly the bank of Canada intends on raising rates.
For Ontario mortgage rates or to speak to a Toronto mortgage broker about financing options, visit http://www.ontariomortgagesuperstore.com
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Cautious optimism is on the lips of many Real Estate agents and economists. Though the last 12-18 months has definitely held some uncertainty in the housing market, the future is looking much brighter for the Ontario home market.
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