Thursday, 12 December 2013

New Report Claims That Toronto Not In Danger of Condo Bubble

According to the report, investors who have purchased roughly half of new condos in recent years could get antsy if rents flatten out or prices soften further. However, most of the new units coming on stream should be absorbed by robust population growth.

Mr. Guatieri concluded that the looming supply of condos, high valuations of detached homes, elevated levels of household debt and expected higher interest rates should slow overall price increases in 2014, even as new immigrants and echo boomers provide support. "We expect Toronto house prices to stabilize in 2014, and to remain at risk of declining moderately when interest rates normalize."

Andrew Auerbach, Senior Vice President, Greater Toronto Area, BMO Bank of Montreal, recommended that those looking to buy in the pricey GTA market should take measures to ensure affordability can be maintained over the long term.
"In light of the potential for higher interest rates in the near future, it's crucial that those looking to buy a home - particularly first time buyers - stress-test their mortgage against a higher rate to ensure they can afford what they sign up for should conditions change," said Mr. Auerbach.

No comments:

Post a Comment