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Is Canada’s Housing Market About to Change Course?
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The boom in the Canadian housing market has really been unstoppable for years. The pandemic even accelerated the pace, making real estate one of the most desirable avenues for investors. However, the housing market can’t remain hot indefinitely and has to cool off at some point. The April 2021 data showed some dampening, resulting in an over 12% decline in home sales month over month. So, is this the start of a prolonged weakness? If so, what should prospective buyers do?
Canadian housing market in 2021
There are more supporting factors for the country’s housing market in the short term. Certainly, home prices have gone to the moon and affordability has taken a huge dent. However, as interest rates remain at record lows, the Canadian housing market could remain at elevated levels.
Housing Market 2021: Is it Too Late to Buy a House?
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Canada’s housing market was gravity-defying during the pandemic. The Canada Real Estate Association (CREA) data shows that over the last 12 months, the rise of home prices was more than in the previous four years. Moreover, the rise in prices in more than half-dozen Canadian housing markets was more than in the preceding decade.
According to a May 7, 2021, report by the Canada Mortgage & Housing Corp. (CMHC), the average home price could rise by 14% from 2020. If home sales climb from about 550,000 last year to 602,300 this year, the average price could soar to $649,400. Thus, is it too late to buy a house now because of inflated prices?