The coronavirus pandemic in the blink of an eye has changed how we do things on a day-to-day basis. There is still a high degree of uncertainty, with the potential ripple effects continuing for years to come. In its early days, COVID-19 and the related business closures dramatically affected the Canadian housing market. Even now, four months later, it’s still unclear what the impact will be overall. A lot depends on governments, how the economy rebounds, and when people will regain their financial footing. For now, we’re seeing interesting trends in the Ontario real estate market in response to the virus outbreak. Here are real estate market trends in Ontario.
Real estate was classified as an essential service during the pandemic – people still need homes to live in, and when the pandemic hit, many were already at various stages of the home sale transaction. RE/MAX agents continue to do their part in facilitating safe transactions by distributing safe showing kits. The government of Ontario prohibited open houses in early April, however with loosening social distancing measures, people who now choose to attend in-person showings can do so with personal protective equipment (PPE).
Other safe showing options include leveraging technology in the form of virtual showings and conference calls in place of in-person meetings, helping Canadians adjust to the “new normal.” From 3D panoramic virtual tours to e-signatures, these innovative approaches allow consumers to actively engage in the Ontario market. You may be surprised to learn that you can even close a home remotely. For those who are in a good position to make a home purchase during this time, it is entirely possible to seamlessly complete the transaction while following public health and safety measures.
The Decline in Ontario Real Estate Sales
Early on in the pandemic, housing sales plummeted. This happened not only in Ontario, but across Canada. Some home sellers opted to delay listing their homes and wait out the immediate uncertainty posed by the pandemic. Inventory remains low in Ontario and prices are stable thanks largely to pend-up demand for Ontario real estate.
These Rates May Pique Your Interest
One of the government’s measures to help boost the economy was by slashing the benchmark interest rate to 0.25 per cent. This provided an opportunity for homebuyers to borrow money at an affordable rate. Those who were still in a position to buy a home during the pandemic could borrow at a lower interest rate, or potentially even increase their budget in order to buy the home of their dreams.
The Good News
A combination of factors may encourage homebuyers to purchase homes, even in the wake of uncertainty. The Ontario government has significantly expanded its list of businesses that can reopen which is a positive sign that life is resuming.
Job security will affect the likelihood of Canadians having the financial power to make a large purchase such as a property. Yet, not that social distancing measures are loosening up, businesses are opening their doors again and ramp up hiring.
In the meantime, the Federal Government has rolled out several relief measures to provide Canadians with financial assistance. This can help people get over this hump and set their sights on real estate in the coming months. In fact, a recent survey conducted by Leger on behalf of RE/MAX Canada revealed that 56 per cent of Canadians who are planning to engage in the real estate market say they expect to do so within less than a year (source: RE/MAX 2020 Global Outlook Report).
As a result of the coronavirus outbreak, the Ontario real estate market has been impacted in different ways. However, there is opportunity for homebuyers and sellers to stay active in the market thanks to technology and the financial incentives that may encourage more people to choose real estate in Ontario. Many have the comfort of knowing that the Ontario market was on the incline prior to coronavirus, and the latest data maintains a continued upward trajectory.