Canadian Housing Market Outlook Predicted to Set Records in 2021
Canada’s housing market is on pace to set more records in 2021. We are starting the year bidding wars, high offers — 20% over asking, bully offers, zero conditions… unbelievable confusion and desperation in the home-buying arena. And historically low levels of inventory.
The pandemic has changed some buyer behaviours by driving many buyers to the suburbs, exurbs, and beyond. The forecast is for the national average price to rise by 8.4% to $669,000 and for home resales to increase to the strongest level ever in Canada up 6.5% to 588,300 units with nearly all provinces showing gains.
Then we expect a cooling period to emerge, which won’t come into full effect until 2022. Overall, 2022 will bring a “soft landing.”
Expect the solid momentum established in 2020 to be sustained in 2021 with a gain of 8.4%, underpinned by tight demand-supply conditions in most regions of the country.
Prices will soften gradually over the course of the year, though, still setting the stage for a more modest 3.9% appreciation in 2022.
The price gains are expected to “stay firm” in most provinces in 2021, bringing property values up 9.6% in Ontario.
We will see stronger gains in smaller markets than in core urban areas because downtown condo prices are likely to stay flat through much of 2021.
Relative to the 10-year average, active listings had plummeted more than 50% in Ontario. This is in spite of the surge in downtown condo listings in Canada’s largest cities since spring.
Kitchener-Waterloo Real Estate 7-Day Market Update. Outlook for continued shortages
New listings: 75
Homes sold: 92
Conditional Sales: 14
Average days on market: 25
Median days on market: 7
Average list price: $598,453
Average Sale price: $672,558
Average SP/LP: 113.34%
Median list price: $575,000
Median sale price: $670,000
Median SP/LP: 112.73%
Kitchener-Waterloo’s top 3 neighbourhoods in 2020 (and other insights and outlooks)
The outlook for Kitchener Waterloo residential real estate in 2021 is an increase in average price of 7%, to approximately $674,977 across all property types.
The top neighbourhoods in 2020 (and likely in 2021) in Kitchener Waterloo were:
Laurentian Hills/Country Hills West
Most first-time homebuyers in Kitchener Waterloo are young couples in search of condominiums.
The region experienced an influx of buyers (move-over market) coming from the GTA, looking for more outdoor space.
The demand for luxury properties continues to grow.
The demand for the new construction market continues to grow.
Kitchener and surrounding cities rents up year over year
The average rent for all Canadian properties listed on Rentals.ca in December was $1,723 per month down 7.1% year over year.
A tenant looking for a rental property in December would have saved about $130 a month on average from a year earlier.
Year over year, average monthly rent for a one-bedroom in Kitchener was up 19.7% and up 8% for a two-bedroom.
Kitchener average monthly rent in December for a one-bedroom home was $1,424 and for a two-bedroom at $1,688.
Waterloo average monthly rent in December for a one-bedroom home was $1,500, and for a two-bedroom was $1,868.
Provincially, Ontario’s average monthly rent was down 7.8% year over year.
Hamilton experienced the highest average rent growth in all of 2020 at 24%.
Kitchener came in second at 17%.
Toronto average rents were down 9%.
Mississauga, North York and Markham all down 7%.
Kitchener-Cambridge-Waterloo corridor experiences a 2% growth in population
Recent data from Statistics Canada showed that in the 12-month span ending July 2020, Toronto saw the departure of 50,375 people.
The Kitchener-Cambridge-Waterloo corridor experienced a 2% growth in population.
Sources: Toronto Storeys, KWAR, Remax, Rentals.ca, Canadian Real Estate Magazine, Better Dwelling, Mortgage BrokerNews