The low exchange rate may be boosting manufacturing, but it is has other effects on real estate across Canada.
Foreign investment is now looking beyond Vancouver & Toronto, and reports suggest that the winds are now predicted to blow towards Montreal & Saskatoon into the new year 2016.
The PwC report is based on surveys from more than 1,200 real estate brokers, developers, property managers and investors. The report states both foreign & domestic real estate investment will shift in 2016 from the West, where slippery oil prices are hurting growth, to the East, where the low exchange rate is boosting manufacturing. However money is still expected to flow into both Vancouver and Toronto.
Calgary and Edmonton were, until a 1-2 years ago, some of the most country’s most promising real estate markets. But the price of barrels of crude has fallen and investment in those areas has receded. This effects both residential & commercial markets in the region. The market has slowed down as owners seemingly take a wait-and-see approach.
Markets in Quebec and Ontario, where most of the country’s manufacturing sector is set to benefit from the lower exchange value + any economic recovery in the U.S., our biggest trading partner. That could generate greater foreign interest in Montreal, the report from PwC predicts. Farmland in Saskatoon has also become attractive to foreign investors, from an agriculture and timber perspective.
Foreign investors are also likely to start buying up medical clinics and other property in the health-care sector; likely to rise from Canada’s aging baby boomers.
The lack of affordable housing in Vancouver & Toronto will slow urbanization in those cities; as first-time buyers move further out to the burbs in search of affordable properties. Prices in those markets are also shifting towards renting, the report stated (especially as an ever larger proportion of the populous won’t be able save enough for a down payment for a new home).
However, we are also seeing trends of correction and stabilization. The future is not easy to predict, even PwC often does not have a perfect crystal ball. Market forces are complex and hard to understand during our hustle and bustle of day to day activities. These are also forces that we cannot individually control. Best thing is to keep working each and every lead, and if you are not already a RealEstateLeads.ca client, there is no better time than the present to start receiving an extra 40-60 hot leads right from the internet; which is our service to supply to real estate agents just like you.
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