Today, a customer asked me if I thought we were heading for a market slowdown. This is a popular question these days, with many people talking about the dreaded bubble. Now, the 'b' word doesn't get invoked too often in my market, since we have such a hot economy, but I am in Toronto a few times a month for business, and my friends there are quite adament that it's going to pop any day now.
There is no bubble. Maybe Las Vegas & the Miami Beach condo market have bubbles (the result of massive new construction that outpaces demand), but in KW we have nothing to worry about. I don't even think Toronto is in rough shape, although most of the building going up in Yorkville right now are going to be in rough shape compared to the Ritz and Four Seasons cotels (a hotel with condominium units as well as traditional rooms).
Here's what I do think is happening: We're definately not going to see growth at the rate we've seen the last few years – and that's good. When home prices go up 15% year after year, first time buyers are priced out of the market, and young families get priced out of nice family areas. I expect we'll end this year with more sales (both quantity and dollar volume), but with price gains much less than last year (but we'll still see appreciation).
With the market cooling off slightly, the segment of the market which has been most affected is the $300,000-$600,000 range. With interest rates creeping back up, buyers are looking downmarket, as the monthly payments start to increase. Homes under $200,000 continue to sell quickly.
There are great deals to be had in all segments of the market, with buyers finding themselves in great negotiating position more and more often.
If you're looking for a great value in the KW area, you can get a free hotlist of homes in your price range by calling this toll free 24-hr recorded hotline: 1 866 507 4605 ID#1040. There is never any obligation or cost when you call.