While the Ontario Real Estate Board called for the close of sales offices as the province and world deals with the coronavirus pandemic, it is still business as usual for developers, real estate agents and buyers... but with a twist.
Through technologies like the Zoom video chat app, phone calls, meetings and emails, GTA-Homes has continued to help clients and customers by completely moving everything online. The need for housing is still high as it is and will always be an essential service, and so, many are forging ahead with their property search and purchases. Investors, in particular, are continuing to choose to purchase strictly online, which is an option we've had available for the last couple of years.
According to the Growth Plan for the Greater Golden Horseshoe, there is a need for 900,000 new homes to be built over the next 20 years and developers are continuing to offer opportunities to own in the pre-construction real estate market right now.
The pandemic has indeed sent global stock markets into panic mode; however, there are reports that housing markets in Canada and Australia, appear almost unaffected. In fact, the Canadian housing market has recently taken encouragement from recent rate cuts.
Interest rates have been the lowest we have seen, with The Bank of Canada cutting the interest rate by a full percentage point in March. As a result, prospective home buyers looking to get a mortgage can now expect to borrow at a decreased rate. Fixed-term mortgage rates are also on the decline, condo and home buyers alike, now have the flexibility to borrow more and aim for a higher home price-- or get a better mortgage rate and have less expensive mortgage payments. Additionally, the First-Time Home Buyer Incentive still stands and can be extra beneficial now that interest rates are down. If financially possible, it can be a great time to buy.
When interest rates are low, the housing market is flooded with buyers all trying to get in. But, with the current state of affairs in the world, there is some resistance from buyers, resulting in a less competitive market. Let's put it this way, when one demographic is reluctant to buy, opportunities open up for another demographic to get into a less competitive market.
Not to mention, when it comes to pre-construction condominium projects that are selling now, prices are set, and they are not going to go up or down, for now. We say this to highlight the fact that now is not the time to "wait and see". Once everything is back to normal, everyone will be out and buying again, perhaps, even more, to make up for lost time. If you are trying to avoid the competition, you might want to skip the "wait and see" strategy.
Before the economy pumped the brakes earlier in March, the Greater Toronto Area's housing market was off to a sizzling and competitive start. And given the huge demand and little housing supply dilemma we have in the region, we are bound to pick up where we left off. If you need a reminder of how hot the market was exactly, the Building Industry and Land Development Association's recent report found that February was a record month for condominium sales. A total of 4,665 new condos, including units in low, medium and high-rise buildings, stacked townhouses and loft units were sold in February 2020.
It is still too early to report the changes to the market due to the ongoing battle with COVID-19. However, on our end, the market is still active with lots of product, reduced competition and a window of opportunity to take advantage of lower interest rates.