Some housing predictions for 2021Market Updates
Some housing predictions for 2021. CIBC issued their weekly market update with some very interesting observations and predictions. The pandemic has resulted in job loss in the lower end of the job sector including services which is a major factor. The higher end job sector has for the most part not been impacted, people spent less hence they saved money plus interest rates are very low. They need and want more space and have created demand in the higher end market. On the other hand, the demand for less expensive houses is less due to economy. Hence in Toronto, the more expensive houses have escalated faster than the less expensive ones. So if you are a mover upper the house that you are buying is rising faster than your house. This will impact the trajectory for the market this year. Vancouver on the other hand which is heavily influenced by foreign investment in the more expensive houses has the reverse effect. This is shown in the graphs below.
In general the prediction is that real estate will be strong this year, particularly spring and moving forward. We are bracing for a busy year.
CIBC WEEKLY MARKET UPDATE & 2021 FORECAST – LIGHT AT THE END OF THE COVID TUNNEL Benjamin Tal Deputy Chief Economist, CIBC Capital Markets