As the year of 2013 quickly winds down, giving entrance to a brand new 2014, I would first off like to thank all those clients, colleagues, associates, & partnership affiliates alike for all the support giving to us over 2013, (and the many years prior), we are very grateful for the opportunity to work with (and for) each every individual, firm, and/or group we had the pleasure of serving, and look forward to another exciting year ahead.
2013 was definitely a year of anticipation and expectations, some had anticipated the national collapse, or “popping of the proverbial bubble (if you will)” within the Real Estate Market in Canada, this thinking was attributed to the change and enforcement of tighter mortgage rules, and also the expectation of higher interest rates. But If Foresight were only 20/20?
What 2013 did prove is that no one can predict the future with any certainty, Real estate on a national level was stronger than many institutional. and National Association experts had expected. Immigration activity in our urban pockets such as Toronto and Vancouver brought with it more homebuyers to the market, and global pressures from an international community along with some uncertainty in the US, had also assisted the Canadian housing market by making it difficult for the Bank of Canada to aggressively raise interest rates over the year.
The result was an amazing year, where the average homeowner saw the equity in their home grow, and those who were seeking to purchase real estate were pleasantly surprised by the great rates that were being offered.
I am fortunate enough to be in a position where I could see first hand the many people who were able to purchase the properties of there dreams at a price that was well within the budget, and also where the amount of money many were able to save at refinancing on renewals, without losing the pace of equity they were building in their home was quite significant, some even saving hundreds of dollars per month!
What should we expect for 2014? it goes without saying that we will most likely hear much of the same that we heard in Late 2012/Early 2013. Real Estate Experts and cynics alike will continue to remind us that the needle’s are coming, and the eventual sky may fall in housing prices at any time. And they have more ammo to use this time as well :
The Historic success of the market of recent years,
The Flattening in the market of winter months, (*Newly Added)
The Potential Rise of Interest rates that will be necessary to combat rising Inflation
The potential collapse of the condo Market, due to oversupply.
The Potential Privatization of the CMHC (* Newly Added. This one replaced the tighter mortgage rules scenario of last year)
But with both National, and Provincial Elections coming around the corner (in 2015 at the latest), it is unlikely that you will see too much in the way of governmental intervention, outside of potential premiums/fees that the government is considering to charge default insurers such as CMHC. Which barring any unexpected occurrence will most likely lead us to a year (2014) that will ideally,be very similar to the year it replaced.(2013)
Which means (for the short term,) the “Canadian Real Estate Fiesta” will hopefully continue for another year, and those participants in at the party, (i.e The industry) should enjoy these times, and cherish those savings they are able to give others on their homes, and real estate property. And perhaps, due to the comments I mentioned earlier in regards to foresight not being 20/20, it may also be prudent to take a moment, and discuss with your clients what paths they will be taking if the party ends, (and rates begin to match with the ones used to qualifying them..) and ensure that they aren’t caught in a situation where they are leaving an ended fiesta drinking and driving…….
Season greetings to all of you who read this over the holidays, I appreciate all of the moments you give us, on this journey, and look forward to sharing many more….!
Richard Samuels AMP
Obsidian Mortgage Corporation