The impact of novel coronavirus on the real estate market has been huge and significant. Earlier this year, the market has been at its peak, but as open houses have been suspended, the market quickly slowed down. Rentals that are only short-term are now either vacant, converted into long-term, or sold.
The Federal Standing Committee on Finance of Canada Mortgage and Housing Corporation stated that the agency now expects a fall between 9% and 18% in average Canadian home prices. An increase in the unemployment rate also causes a big effect on the market. Brendan LaCerda, a Senior Economist, said that their estimation indicated that a 1% increase in unemployment will yield to 4% drop in the market prices.
The interest rate has also been known to have an influence over the real estate market. Interest rates that are lowered to near zero percent by the Bank Canada will definitely result in a decrease in a mortgage rate. This will make potential home buyers have affordable prices.
The real estate market in Canada is surely affected by the COVID-19 crisis, though it is hard to tell whether it will cause a positive or negative impact. If you are planning on buying or investing in real estate, now is probably the time to talk to a good real estate agent.