Market Notes: Will Toronto real estate continue to rebound?
Nick Horton, Founder.
The market finished September off strong, continuing on its upward trend when compared to the last three months. I expectthis to be reflected in the Toronto Real Estate Board sales figures next week. I also expect a more positive bias to start emerging in the media after these sales figures are released. As a result I expect the ‘risk-off’ attitude to diminish further. At worst, it appears we are heading into a more balanced market, although I wouldn’t characterize current conditions as a buyers market or say the market is trending toward the buyer side. The fall market hasn’t solved the quality condo inventory issue downtown, with bidding wars and bully offers still present. The freehold market is clearly rebounding with the only question being to what end?
This week the loonie retreated significantly after dovish comments by the Bank of Canada on the projection of interest rate increases. Economists now expect the next interest rate hike to be in December at the earliest, although the Bank of Canada has been very hard to read when it comes to policy. A lower loonie and low interest rates for a longer period will continue the market rebound. Downside risk exists if or when the government imposes the new stress test for uninsured mortgages.
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