The coronavirus has affected the Canadian real estate market by changing the way people live, work and play. While COVID has been a major issue all around the world, it has also impacted the economy in different ways.
Here’s how COVID has impacted Canada’s real estate market:
Record Low Mortgage Rates
As COVID emerged, mortgage rates began to plummet. The cost of financing a home reached such dramatic lows that nearly everyone wanted to get in on the action. Those who were uncertain if homeowning was in their near future quickly realized that now was the time to make a move on the market.
However, this didn’t mean that the housing market would be smooth sailing.
Due to many people losing jobs, falling ill, or other circumstances the amount of property sellers and buyers waxed and waned throughout the last few months.
At times, there would be surges of home sales due to the historical lows of financing while leading to a devastatingly low amount of homes for sale due to homeowners having an uncertainty of whether or not the economy would be in their favor.
This led to many homeowners staying put in their current home rather than listing it for sale. While on the contrary, this also led homeowners to sell their home for the high profit margins but having the unpredictability of whether or not they would be able to then purchase a home to their standard due to the highly competitive market.
Increased Profit for Sellers
As the real estate market quickly progressed to a seller’s market, homeowners were seeing astronomically high increases in the equity of their home due to the high demand of homebuyers.
For some, this convinced homeowners to put their home on the market for a profit they wouldn’t likely see in the future. While others used this opportunity to take advantage of the record low financing rates to refinance their home for a lower mortgage rate which provided them with the opportunity to renovate their home to also increase the equity.
With the real estate market remaining highly competitive, this led to not only eager buyers but occasionally angry ones. A typical home sale led to ongoing bidding wars and sacrificing things such as inspections to seal the deal.
Many potential homebuyers called it quits all together as they saw the market as being impossible to maneuver and instead held onto what was currently theirs instead of reaping the benefits of the perks this market had to offer.
An Increase in Sales in Vacation Towns
Throughout the pandemic, a large shift was made into the teleworking sector of jobs. Many were now working from home and realizations were made that there was more out in the world to see and enjoy.
Many homebuyers flocked to vacation towns to get an escape from the town or city they were presently in. Halton real estate saw large demands, which not only led to an increase in home sales but also each designated vacation spot’s economy.