18 Dec Christmas Market Notes: Uncharacteristically Strong December
Christmas Market Notes!
December has been a very active month, and an uncharacteristically strong month because of the push to buy before the new mortgage restrictions. Some sellers have been taking advantage of the market conditions. I am seeing homes that did not sell earlier in the year being put back on the market and selling quickly. Additionally, 2 properties in Dundas West sold for surprisingly big numbers last week.
Having said that, I am also seeing more price reductions on properties that need work or are in fringe neighbourhoods. The market has been a bit scattered, but overall, downtown Toronto real estate has been resilient this fall/winter and outperformed the 905 by a wide margin. This week, two big real estate companies gave their opinions on where real estate is heading. Royal Lepage believes price growth will continue in the GTA, up on average 6.8%. RE/Max believes prices will be flat, with prices declining significantly in the first quarter, then rebounding back to par.
In my opinion, both these scenarios depend heavily on what happens with interest rates. There is a small chance they go up a quarter point in January, but more likely in March. The United States is calling for 3 interest rate hikes in 2018, and depending on what happens with NAFTA, we could see the same. I am bullish on interest rates rising and wouldn’t be completely surprised by a January hike. Either way, a rate hike within the first quarter of the year would be a headwind and play right into RE/Max’s view of a slow start to the year. Regardless, selling your property in the spring will take a nuanced approach and if you are purchasing, be ready!