It’s time to start speculating about the 2019 real estate market

Welcome to 2019. Last year was a time of market cooling with rising interest rates and new government regulations. It was a rocky year. Sales weren’t that strong, supply didn’t exactly skyrocket, and prices remained high. So, what does 2019 hold for the real estate market? 

For all of January, we’ll be chatting with industry professionals, keeping an eye on market statistics, reporting on plans for future new home openings, and even sharing some design trends and predictions. 

Based purely off the stress test and the high prices, we think it’s pretty safe to say that sales will remain slow this year. Everyone’s borrowing power has been impacted by the rising interest rates and stress test, and prices aren’t adjusting to what people can afford. 

There was some talk last year about the idea of repealing the stress test. It was introduced to calm the market and that’s exactly what it did, but with interest rates up and prices high, is the stress test still necessary? Mattamy Homes executives said a full repeal of the stress test would be ideal and their CEO and founder Peter Gilgan said that a reduction to 1.5% or 1% would help. Currently, you are required to qualify at 2% above your contracted rate. The goal is to ensure you can afford your mortgage even if rates spike. Will we see the stress test reduced or repealed in 2019? 

On the construction front, the Canada Mortgage and Housing Corporation reported downward trends throughout 2018. With 2017 sales high and 2018 sales down year-over-year, it seems like construction will remain active. Some of the new condo sales from 2017 probably haven’t started construction yet. It’s pretty safe to say that detached home construction will be slow since sales were slow throughout 2018. 

We can speculate all we want right now, but the truth is, 2019 is a mystery until we hear from more professionals and pundits in the know. We’re also interested to see if the government, on any level, makes any significant moves to impact the housing market. 

Stay tuned, we have plenty of special features in the works, all predicting what 2019 holds for the real estate market!