In our profession, we are constantly asked "how's the real estate market doing"? At this time of the year, we are more likely to be asked for a prediction as to what's "going to happen this year".
From my perspective, it would appear that the first half of 2011 will be similar to the first half of 2010 ... steady sales and very modest price changes ... good things. In other words, the market is stable and predictable. The days of large price increases are behind us and, hopefully, dramatic price decreases are not awaiting us.
New home construction history is a good argument for this analysis. For example, Reed Construction Data Canada reported that housing starts in Canada averaged 222,000 units per year between 2002 and 2008. However we dipped dramatically to 112,000 units in 2009. Since early 2010, the national monthly [housing] start level has averaged slightly below 200,000 units on an annualized basis.
For those selling this year, we would suggest that by March or later your asking price should be 'on the money' as opposed to 'fishing for a higher price'. As you go forward into the spring more and more homes come on the market to compete for the limited amount of buyers. More importantly, the fear of increased mortgage rates (which has already started to happen) will encourage buyers to get into the market place earlier as opposed to later in the year. We love to talk pricing strategy.
For those buying this year, get a mortgage commitment letter from your lender as early as you can. Try to get the interest rate 'promise' for as long a period as possible. Keep in mind that you have to be in your new home before the commitment runs out. The rules for insured mortgages from Canadian lenders has become more restrictive and, as mentioned above, the interest rates are on their way up. No need to help the banks make 'record profits'. We can help you get better rates and terms on a new or renewed mortgage.
Finally, our team is off to a great start in 2011 and we hope to be your 'go to' real estate source this year. Our advice is free and is available in both official languages!
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