(Toronto) The emergence of the Omicron variant of the coronavirus could stretch the period of exceptional strength in real estate markets in Canada, which will push real estate prices higher in 2022, but at a slower pace than this year.
According to a market forecast from brokerage firm Royal LePage released on Wednesday, the weighted average median value of all property types is expected to increase 10.5% year-over-year to $ 859,700 in 2022 nationwide.
Pent-up demand from buyers who were unable to complete transactions in 2021, coupled with housing demand from new household formation and newcomers to Canada, will continue to drive up prices in a struggling market. a chronic shortage of inventory.
Royal LePage President and CEO Phil Soper believes that due to the recent spike in COVID-19 cases caused by the Omicron variant, the Bank of Canada may be hesitant to put rates in place. higher interest. Plans to return to the office may be delayed, maintaining the importance of the home as a place to live and work, and entertainment and travel will again be restricted, which will support household savings.
Phil Soper reminds that all these economic factors stimulate the real estate market.
In the Montreal area, the average median property value in the fourth quarter of 2022 is expected to increase 8% year-over-year to $ 564,800, compared to 1.892 million in Vancouver and 1.256 million in Toronto .
In Greater Montreal, the price of a detached single-family home is expected to increase 9% to $ 648,600 while that of a condominium will rise 6.5% to reach $ 447,300. The shortage of single-family properties is expected to boost the condominium market.
Dominic St-Pierre, vice-president and general manager of Royal LePage in Quebec, believes that multiple bids and higher bids should be less widespread next year than they were in 2021. He expects a rise in the supply of housing increases once the interest rate hike takes effect, which could ease pent-up demand and open up new opportunities for buyers.
Mr. St-Pierre also believes that immigration should be a major driver of economic growth in 2022 and contribute to the demand for housing in the Montreal area, unless the Omicron variant challenges border management again.