The Vancouver market is cooling down and the number of building permits and new listings is also slipping along with the sales.
Toronto, Ontario (PRWEB) August 13, 2012
Marcus Arkan, CEO of renowned mortgage brokerage Syndicate Mortgages, has once again stepped forward to help homeowners and borrowers make the right mortgage decision by informing them regarding current happenings and future possibilities in the housing industry. In this aspect, Mr. Arkan has shared latest stats and figures from Canada’s major housing markets.
Major financial institutions and banks including ScotiaBank and Bank of Canada revealed that Canada’s housing market is cooling down even in Toronto and Vancouver. Both Vancouver and Toronto were among the hottest spots during the first quarter of 2012. According to Mr. Arkan, this could most probably be the effect of the new mortgage policy introduced last month.
According to the Real Estate Board of Greater Vancouver a total of 2,632 units were sold, down 27.6 percent as compared to the same month last year. In July, Vancouver home sales hit their lowest since 2000. Similarly, the Real Estate Board of Toronto stated that home sales in Greater Toronto were also down 13 percent. Mr. Arkan agrees that the cooling down of the housing market is exactly what was intended with the new stricter mortgage rule introduced by Jim Flaherty this year.
However, Mr. Arkan expressed concerns over the situation in the Greater Toronto condominium market. He said, “The Vancouver market is cooling down and the number of building permits and new listings is also slipping along with the sales. In Toronto, the situation is different. In July, Toronto had the biggest gain in build permits and that is despite the lower sales. This could create a severe issue in the near future especially if the prices remain high.”
Urbanation, a financial firm that has recently conducted a detailed study of Canada’s housing market, has also backed the possibility of the over-supply situation in Toronto. According to their report, new condominium sales were down 50% from the last year while the number of built permits in July has increased 21%. Due to this reason, the number of unsold units in July was standing at a record high 18,123.
Apart from the impact of new mortgage policy, another possible reason behind lower sales can be the prices that have remained high in both Vancouver and Toronto. Royal LePage’s recent survey states that the prices for the second quarter went up as compared to last year and the first quarter of this year. As the price largely depends on the demand, the prices are expected to go down. However, the same report indicated that the prices in Vancouver have already dropped 0.7% from June.
Based on these figures, Mr. Arkan predicted a mild price drop in the next quarter. Analysts from ScotiaBank also predicted in their report a possible price drop of around 10% in the next three years. “There is a major supply-risk in Vancouver and Toronto made worse due to affordability issues created by the new policy. A price drop is inevitable but we can only assume that it won’t be as severe as the last major national price decline of 2008,” Mr. Arkan concluded.
About Syndicate Mortgages Inc.
Syndicate Mortgages Inc. is one of the leading Canadian mortgage brokerage firms. Founded in 2008 in Ontario, the company specializes in residential, commercial and construction financing across Canada. With years of experience and expertise in the mortgage industry, and access to an array of lending institutions across Canada, Syndicate is known for finding the best mortgage rates for their customers. Syndicate has branch locations across Canada.