Do you know that despite Financial Pundits are predicting worse, Real estate market is holding steady and First Time buyers keeping market upbeat. The real estate market is clearly on its way back. The market has turned and that better times are on the way.
Let me give you some important information that making waves in Real Estate Industries.
Bank of Canada holds interest rates steady
The Bank indicated that economic and inflation outlooks are better than what they predicted before. The Bank acknowledged significant improvements in financial conditions and commodity prices, and modest recoveries for consumer and business. However, it expressed concern that these positive economic factors could be fully offset if “unprecedentedly rapid rise in the Canadian dollar proves persistent.”
The Bank of Canada has also helped to juice the market. By holding interest rates lower to stimulate economic growth, the central bank has cleared the way for mortgage rates that remain at historically cheap levels even after recent increases.
The Bank also reiterated its pledge to hold interest rates at current levels until the end of the second quarter of 2010, conditional on its inflation outlook.Resale housing market continues to recover in April. Figures released by real estate boards around the country are showing a positive upward trend in sales driven by improved affordability and less uncertainty about the future.
In the midst of recession, the average national price of Canadian real estate hit a record level in May, and sales activity increased for the fourth consecutive month
“REALTORS® know that several factors have led to this market situation,” says Regina, President of The Canadian Real Estate Association.
1. Price adjustments in some markets have helped affordability.
2. Lenders do have money for people and properties that qualify, although some are being more stringent.
3. Consumer confidence, which has risen in the housing market through the Spring.
4. Sellers have realized that realistic pricing is key, and that is very much driven by local factors. “Homes are only worth what a buyer is willing to pay.”
Home sales forecast revised
Ontario had a record-breaking number of resale homes sold in May. Greater Toronto Realtors reported 9,589 sales in May which is almost 2% up from May 2008 – the first annual increase since December 2007.
“The resale housing market in the GTA has remained resilient in the face of challenging times globally, Many home buyers have taken advantage of extremely low mortgage rates.” according to Toronto Real Estate Board President Maureen O’Neill.
“Monthly resale housing activity improved as the first quarter progressed, entering the second quarter on a rising trend and closing in on levels last seen before it fell sharply late last year,” said CREA Chief Economist Gregory Klump. “It will take time for housing inventories to be drawn down enough to put new home construction on a stronger footing, but the balance between resale housing supply and demand is improving in a number of major markets. The national average price has begun to rebound from the recent low reached in January, and is forecast to begin rising modestly above year-ago levels in the fourth quarter of 2009.”
Economic impact of home sales
The resale housing industry in Canada generated more than 202,000 jobs and an average of $22.3 billion annually in various economic spinoffs in the period from 2006 and 2008, according to a study prepared for The Canadian Real Estate Association by Altus Clayton.
“Purchases and sales of homes trigger additional expenditures that have broad economic impacts,” said CREA Chief Economist Gregory Klump. “Job creation is also a major factor of the sale of a home.
The 2008 national MLS® report from The Canadian Real Estate Association says there were 462,734 residential properties sold through the Multiple Listing Service® last year.
Harmonization of GST and sales tax.
The provincial government has announced that it intends to combine the eight percent Provincial Sales Tax with the five percent federal Goods and Services Tax, creating a 13 percent Harmonized Sales Tax (HST).
• The HST is NOT YET IN EFFECT. The provincial government has indicated that it intends to bring the HST into effect beginning on July 1, 2010.
• HST will not apply on the purchase price of re-sale homes.
• HST would apply to services such as moving cost, legal fees, home inspection fees, and REALTOR® commissions.
Call or email me for info on HST(Harmonized Sales Tax) and other Real estate information
