Housing market crash not in the cards, local and national experts say
A new report from a national think-tank says the notion of Canada being in a ‘housing bubble’ that could pop at any time is unlikely – and a local real estate expert says even if it were to take place, Waterloo Region wouldn’t be affected.
In a comprehensive new look at real estate across the country, the Conference Board of Canada says housing starts over the past three years have more or less been in line with long-term trends.
The only possible exception it found was in Toronto, where it cited a “borderline” risk of overbuilding.
Although playing down notions of a severe bubble and accompanying crash, the report did state that a “modest correction” was possible across the country – although any declines would be limited by population and employment growth, along with mortgage rate increases.
Locally, real estate analysts say Waterloo Region has been a steady market stretching back two decades, and that’s not expected to change.
“It’s not like Toronto or Vancouver,” Bev Hepburn, sales manager with Coldwell Banker Peter Benninger Realty, tells CTV News.
“In the past 20 years, we’ve gone through 3 to 5 per cent increases in our market per year, as far as price goes. That’s been very, very stable.”
Hepburn points to the region’s diversified economy and education base as one reason he doesn’t expect to see any decrease in home values.
Another advantage, he says, is that little land is available for new residential development – meaning it’s unlikely the region will become overbuilt anytime soon.
“The plan is to grow up and intensify, not grow out,” he says.
The Conference Board says it expects mortgage rates to start rising within the next few years – but gradually, with a two percentage point increase forecast by 2017 or 2018.
In Kitchener and Waterloo, the average home sale price for 2013 stood at $335,217.
With files from The Canadian Press