Optimism Levels In The Post-Pandemic Canadian Housing Market At Record High
The faith of Canadians in the country’s housing market remains high despite the resurgence of the coronavirus pandemic, which is threatening to bring the economy to a standstill.
Over 45% of respondents who were surveyed by the Nanos Research Group stated that they believed their neighborhood property values would rise in the next 6 months. This is the highest reading observed since March, back when lockdowns were imposed throughout the country due to the COVID-19 pandemic. Only 13% of respondents thought that prices were going to crash, which is the smallest observed reading.
The housing market has had a positive outlook in the last few months with historically low home interest rates and work-from-home restrictions generating strong demand. On the other hand, supply remains low for now, which is driving property prices up the hill across Canada.
Toronto-Dominion Bank’s chief economist Beata Caranci stated that low-interest rates were driving demand levels in the country. Many individuals who were previously undecided are jumping in to take advantage of the low-interest rates. Many homeowners are also refinancing their mortgage payments.
Canada’s sales to new listings ratio, which measures market balance, is currently at the highest it has ever been in 20 years. Demand is vastly outstripping supply in the housing market.
The optimism here is also offsetting growing concerns elsewhere for many Canadian households. Overall consumer confidence dropped for the first time in October since the pandemic began, as signs emerged that economic recovery would be an uphill task. The Bloomberg Nanos Canadian Confidence Index fell to 52.5 from 53.1 at the beginning of October.
Nanos Research surveys over 250 Canadians every week, seeking their thoughts on issues like the housing market, the economy, job security, and personal finances. A 4-week rolling average of 1000 responses is published by Bloomberg every month. The housing market was the sole component where respondents showed any signs of optimism.
Although overall confidence levels fell for the month of October, it did rebound a little near the end, stopping a 4-week fall in confidence levels.