Continuing Lockdowns Push Urban Dwellers Out

It’s an unprecedented time in Ontario’s real estate market. While some parts of the province are seeing development halts and pivots, other parts are exploding at rates nearly impossible to keep up with. So what do we see changing as 2021 sits just around the corner? Read on to see where the COVID-19 real estate market is headed.

As a well-known mortgage broker in the South Georgian Bay and Lake Huron area, Gerard Buckley, team leader of Buckley Mortgage Wellness, has a lifetime’s wealth of financial knowledge. He’s spent many decades navigating the uncertain waters of Ontario’s financial markets, all the while helping his clients weather storms of uncertainty. Here are key economical points that he is keeping tabs on during the pandemic, Canadian lockdowns and the effects on consumers all over the province.

Tough News for Metropolitan Landlords

As Toronto and Peel find themselves in another full lockdown and many other GTA regions hunker down in “red” restriction zones, fewer residents are looking for city rentals. Unsurprisingly, listings that have been affected the greatest include the entire micro-condominium market as the draw of a 300 – 600 square-foot space loses its appeal when city social life grinds to a halt.

While rates of immigration to Canada would regularly offset this oversupply of rental units, 2020 saw a great decrease in those who made Ontario their new home as COVID travel restriction limited country-to-county movement. Should a successful vaccine be used worldwide, as is hoped for the beginning of 2021, new immigrants to Canada would once again surge. That being said, unit owners may be faced with a difficult winter as many look to secure longer-term renters in what were once AirBNB listings.

Suburban & Rural Areas Continue to Boom

So where are the residents who once dwelled in downtown areas flocking to? Look in any of the communities outlying the GTA and you will find them. Counties from Caledon all the way up to Huntsville and beyond are experiencing growth like no other point in recent history. Areas in Simcoe, Grey and Bruce Counties that offer both forested hills and water views are selling far above asking price with often 10 or more offers.

In all areas outside of Ontario cities, housing supply will continue to be an issue even though we technically are “over-housed” in many of these regions. This takes into account that mere single or double-occupancy occurs in homes with 4 up to a staggering 12 bedrooms.

With extensive material delays and issues with municipal permit restrictions, those looking to build have an uphill battle. To properly accommodate the current housing demand, we hope to see greater efficiency in these processes as more pressure is applied to town and township planning offices. Red tape surrounding building permits leads to higher housing costs for builders, buyers and renters alike. A better permit process could create more affordable housing solutions with greater home availability and, as a result, affordable rental units.

Financing Won’t Stand in the Way of Builders or Buyers

One key factor that won’t be adding pressure to individuals and families seeking a home is the cost of lending. The Bank of Canada has indicated that we can expect interest rates to stay low well into 2023. This will allow many homebuyers or those seeking to get construction mortgages to fund their purchases and projects. 

While we can be confident about interest rates and the cost of borrowing staying low for the next two years, beyond that remains to be seen. If the government continues to spend money by supporting both residents and businesses, this should continue to drive the economy and avoid any catastrophic fallouts.

MAKE YOUR MOVE WITH CONFIDENCE

Looking to buy a property in Simoce, Grey or Bruce County in the rush of the COVID-19 real estate market? Make a smooth transition into our rural communities with the help of Buckley Mortgage Team — a group of savvy mortgage specialists dedicated to helping people of Ontario access the right home for their lifestyle. Speak with us to learn more or use our handy online pre-qualification tool to get started!