The Toronto real estate climate has changed significantly in the past couple of weeks, with home buyers holding off making purchases as a result of the uncertainty in the US Financial markets. Canada remains in a far stronger position than the United States. The property foreclosure rate in Canada has remained at the “normal historical levels”. There is no mortgage crisis here, people are still able to afford and are still paying their mortgages normally. We do not have the ARM mortgages that reset to higher rates. It is more difficult to qualify for mortgages and the almost everyone has positive equity in there homes – i.e. their mortgages are for less than the total value of their homes. Canadians are not walking away from their homes at all. Our Financial Institutions are strong and are looking for acquisitions of weak US companies to acquire. However, we all watch the US media and the concern does impact buyer perceptions. So too there are many links in the economics of the two countries.
Thus, we are seeing a slowdown in real estate buying activity, but not a concern of plunging home prices. The housing situation is just following the general economy and is not leading the decline the way it has in the States.
The Toronto market is presenting some terrific buying opportunities.
I do not foresee any meltdown of the Toronto real estate market.