As the Bank of Canada is ready to announce another .5% interest hike, reverberations that have recently settled from the last hike have once again made the investment ground unsteady as many sellers are divided in the decision to sell or hold on to their primary home investment. The effects of the first hike were unpredictable at best. Although price adjustments were made, house competitions dwindled, while certain areas continued their surges in price points. With article after article predicting the downfall, stabilization or resurgence of the real estate market making their daily rounds, the investment waters are further muddied by personal opinion, country real estate comparisons (Canada ranks among the highest price points for homes), and recent interest hikes south of the border. So what is the common denominator to hold onto in the consideration of buying or selling real estate as we enter what is usually a hot spring season? Sales, by the number of units, have dropped in February and March of 2022, when compared to last year’s performance. However, price points have evidently increased alongside inflating prices in every other sector. So where is the middle ground, or the line that determines whether it is a good time to sell, or a better time to buy? Although interest rates will continue to rise, the interest rates themselves are still relatively low and close to a year before pandemic values. If house inventory is also low and not increasing in the near future, then the market remains a seller’s market. Fortunately, for buyers, the interest rate hikes have helped to soften competition vigor, which in turn, has leveled out sweltering prices on homes. Homes have steadi
ed on this front, which ironically, makes it both a seller’s and buyer’s market for this intermittent, bubble period. Will the market crash on the basis of this strain? Probably not. Will we encounter a recession that inhibits buying and selling power? Possibly so, but not so much in the near future as it may occur in 2023 at the expense of curbing inflation rates. Either way, it still remains a good time to delve into the real estate experience.
