Stability is in the forecast for the Toronto Real Estate Market this Year.

Although the Canadian real estate market has, for the most part, averted the brunt of the recent worldwide recession, many people were apprehensive about the possible negative economic effects which may continue to inhibit their ability to smoothly navigate the real estate market. Most of these fears stem from the unenthusiastic stream of news coming from our neighbours to the south.  While the US economy is still trying to get back on its feet, Canadians are realizing how mildly scathed the Canadian market has remained. By looking at other areas of the Canadian economy, people can see that job levels and other consumer trends have thus far recovered at a remarkable rate.

Most importantly, Toronto continues to be a top ranking economic force in Canada. The growth surge between the financial sector, manufacturing industries and consumer confidence, coupled with a low interest rate, means that we can expect to remain in this position for the remainder of 2011. While apartment rents may flatten, condominiums will continue to be in demand by investors, buyers and renters alike. A large share of the real estate market will continue to focus on condominiums, as many condos continue to be available at attractively low prices.

As for the residential housing market, more stable conditions are expected to continue for the rest of the year. Sellers are slightly ahead this year, as market conditions have leaned marginally in their favour. We can look forward to continued temperate price gains.  While the start of the year showed somewhat slow sales activity, there may prove to be a temporary rush to avoid the new mortgage rules coming into effect in March 2011. After March, sales may lessen slightly but the long term effect of the new mortgage rules are expected to cause a bit of a boost in the market. The rules, effective mid-March, change the maximum amortization period for residential mortgages to 30 years from 35 years, while mortgage refinancing limits against home equity have been lowered to 85% from 90%. While these changes could potentially bump some first-time buyers out of the market, overall it is expected to have a positive impact for move-up home buyers, as it will create a more stable real estate market.

For more information please contact Heidi Nelson

Harvey Kalles Real Estate Ltd., Brokerage

Business: 416.441.2888 ext. 400, Toll free: 1.888.452.5537, Cell: 416-720.0356