Predictions for the 2016 Collingwood and Area Real Estate Market
O.K., I did it. I mustered up my courage, held my breath and took a look back at what I said twelve months ago about my predictions for the 2015 real estate market. You can read that post here.
Hooray! My record remains intact once again and hey, I’m getting pretty good at this predicting thing if you look back over the past years. Not perfect but better than those groundhog prognosticators are at forecasting the weather. As predicted, interest rates held, mortgage lending rules tightened and it was a very good year.
So what lies ahead for 2016? Gulp. I don’t know if I really want to do this again except that I know in my bones it is going to be another stellar year barring any major, unforeseen catastrophes.
First I have read far too much annoying data such as this from the Canadian Real Estate Association, this article in the Financial Post, this one in the Globe and Mail and of course, the RE/MAX 2016 Housing Market Outlook Report.
The reasons I say annoying is because they can have a doom and gloom headline but read the article and it is quite the opposite. Others are too rosy and read deeper to find more balanced info. I guess that’s how news sells. But I digress.
In Canada, we have some changing economic situations with the drop in oil prices, drop in the value of the Canadian dollar and real estate markets that are entirely different from one end of the country to another. While places like Calgary and Edmonton are showing softening real estate markets, places like Toronto and Montreal are booming. For Ontario, the low dollar combined with low energy prices is actually a boon for the economy with better export potential, cheaper manufacturing and lower transportation costs. It would seem that economic power has shifted back to Ontario with the exception of Vancouver.
In addition, we have record immigration and, Canada’s stable economy and banking system continue to be beacons for foreign investment.
In Southern Georgian Bay, we are seeing many forces at play beyond those described above. We have a large number of people moving into the area for retirement. We have families moving to the area to open businesses, enjoy a healthier lifestyle and to take jobs in a growing marketplace. A study done by the Canadian Federation of Independent Business’ ranking of Canada’s top entrepreneurial cities shows Collingwood at #3 of mid-sized entrepreneurial cities in Canada, up from seventh in 2014. Investors, being priced out of the GTA market, have discovered our growing area and of course, we continue to have a strong secondary property market.
The Bottom Line: I think we’ll see interest rates stay low through most or even all of 2016. Any slight increase would only fuel the market even more. We have a very tight supply of properties for sale in the area and that means there is significant pent-up demand going into this new year. For that reason, I think we can again expect to see continued strong market conditions with price increases topping 5% in most market segments. Expect to see ultra-strong performance and higher price increases in residential condominium apartment buildings and, in houses in-town Collingwood. We’ll beat 2015’s record levels and I’m betting that we’ll also see over 300 sales in one month (June?) in our area – something that hasn’t happened before.
Hang on to your hats again folks, my guess is that it’s going to be quite a ride.