Real Estate Cheat Sheet: four trends to expect in 2014

Real Estate Cheat Sheet: four trends to expect in 2014

(Image: ruffin_ready)

Whether or not you think 2013 was a good year for Toronto real estate depends, to a large degree, on where you stand in the market. Things are still relatively good for owners of single-family homes, but renters and condo owners face a more complicated reality. Here’s a look at how things are shaping up for Toronto’s real estate market in 2014.

1. Home prices will probably keep rising
Despite constant warnings from analysts that Toronto’s real estate market is overheated, things were great—a little too great, even–throughout 2013. A recent forecast by Central 1 Credit Union says we can expect continued growth in coming years, with an average four per cent annual rise in home prices through 2016. The forecast also calls for Toronto’s condo market to slow, but not crash. Rental vacancy rates are expected to stay frustratingly low. [Canadian Press]

2. Picking out a brokerage is going to get more complicated
Real estate brokers were once forbidden from charging both a flat fee and a commission, but the provincial government changed the rules in November. Now, brokers can charge any combination of those two things. As a result, it’s likely that dealing with agents is going to get trickier: what used to be a relatively simple arrangement will become a negotiation over how, exactly, payment is going to be calculated. This could turn out to be a good thing for consumers—at least in theory, it will introduce more flexibility and compeition into broker fees. [Ontario Government]

3. New home builds aren’t going anywhere
The former military base at Downsview Park has been under redevelopment for some time, but in November it was announced that Mattamy Homes would be partnering with Urbancorp to develop 1,000 units of housing in the area. The involvement of Mattamy means things will likely start moving quickly, and it points to continued interest in newly built homes. [Toronto Star]

4. The condo market will continue to be clouded by uncertainty
A continual source of uncertainty in Toronto’s condo market is the notion that the whole thing is being driven by speculation—that people are buying condos as investments, rather than living in them. If that’s true, then the market is vulnerable to investor panic, which can lead to a crash. A new report from the Canadian Mortgage and Housing Corporation does little to assuage that worry. It says about 23 per cent of Toronto’s condo stock is being rented out by owner-investors. Some experts think the true figure is closer to 50 per cent. [Toronto Star]