Calgary housing market expected to cool
The red hot market in Calgary is expected to cool down over the next six months according to a new report from the Calgary Real Estate Board. With growth in the energy sector providing employment, demand has been high in the region and the average MLS listing price is expected to end the year 5.5 per cent higher than 2013. The increase in net migration that the growth in employment has brought to Calgary had not been predicted to be so large. CREB’s chief economist Ann-Marie Lurie says the issue for Calgary could be a mismatch between property supply and property demand; certain types of property may be in short supply while others may be harder to sell. Read the full story.
Recovery of US economy could mean higher mortgage rates here
For those of us who are not economists, some of the interconnected financial systems can be baffling. Experts are predicting that five year mortgages in Canada could start to creep up as the economy of our neighbours south of the border gains pace. Here’s how it works. Our five year mortgages are generally tracked on the yields of government bonds; when the US economy is weak the value of their bonds (and ours) fall, which triggers a drop in mortgage rates. As the US economy improves and bonds increase in value again, mortgage rates rise. Some economists are forecasting rapid growth for the US economy which could mean some painful rate rise for homeowners in Canada. Read the full story.
Vancouver ‘not headed for a crash’ says credit rating agency
A major credit rating agency says that it does not expect a correction in the housing market in Vancouver. Based on historical data, the report from DBRS views the market in the city as not significantly overheated and therefore not at major risk of a correction. While noting that affordability is an issue for many in the city, the report also highlighted the strengthening economy and low interest rates as factors in a steady market. The quality of living in Vancouver is also cited as a reason for a buoyant market; people just want to live there. The credit agency’s report gave brief analysis of Canada’s other major markets and continued the positive note for Toronto, Calgary and Montreal. Read the full story.
Affordability for rentals gets tighter
While property prices in Vancouver mean buying may not be possible for many, the rental market isn’t an easy option either. With vacancy rates at just 1.9 per cent and set to tighten next year, finding and affording a rental property can be tough. The new Affordable Housing Agency in the city is working to give more options to middle-income families and planners say 16,000 new rental units are needed by 2021; reports suggest that target is more than half way to being met. While new buildings are required, many renters choose to stay in older developments that offer cheaper rents, albeit with fewer amenities. Read the full story.