By: Beth O'Donoghue

2019 Predictions

Tags: Real Estate, 2019, Prediction, Toronto

Falling Interest Rates By The End Of The Year

Bank of Canada made a mistake by raising rates. They’ll never admit it but its ok.
Economy is not growing fast enough to merit rising rates.
Bad economic conditions overseas will trickle down to our economy
Announcement of major shutdowns that will happen at the beginning of next year (manufacturing) will start to rear its ugly head

Residential Rental Rates will continue to rise

Vacancy will continue to be low.
Less people are moving due to rising prices so inventory will be tight
In the summer you will see rentals skyrocket
I predict in 5 years 85% of resident’s downtown will be renting

Prices will stabilize- in some places

In certain parts of the city do not expect this- anywhere in the core and the east end (Leslieville, Beaches) are going to keep going up demand is too high and supply is too low
The suburbs are going to see the biggest slow down- they are the first to be affected by any news announcements, interest changes etc. There is inventory available that is taking longer to sell. Sellers will need to be more realistic of where the market is at. Agents will need to spend more time prepping and selling listings. It won’t turn into a buyers’ market however we will get some balance.

You won’t stop the condo train in the core

There simply is not enough inventory.
The approval process has halted development in the city- we will be delivering approx. 1/3 of the amount of the units we have been producing for the last several years.
This will put upward pressure on the resale market causing prices to rise.

The Precon Market doesn’t make a lot of sense right now

If you’re looking for cash flow as an investor you need to buy resale right now. If you are looking long term precon is always the way.
If your buying your dream unit off plan-precon away
Number vs. number precon doesn’t make sense but it will not get cheaper
 
Precon in the core doesn’t make a lot of sense however if you move outside of it- Etobicoke, North York, Scarborough, it sure does. Renters will be forced to move out of the city as prices continue to rise. Grabbing a rental outside the core is more attractive than ever.
 
Luxury market throw off

Last year we had a record low as far as the luxury market was concerned. I predict this to start changing dramatically.
We have a lot of old money here in Canada- especially Toronto. As these boomers are getting older I bet a lot of them are going to trade their mansions for a penthouse downtown and another vacation home. Toronto is cold and it sucks. Old people hate cold. Makes sense, not doing rocket science here.
The luxury market will drastically effect stats- when you read stuff always read it with caution. Data can be made to look anyway a writer wants but they rarely give you the full picture.

Commercial Real Estate is on the rise

Lots are hard to find.
Developers are being taxed to death.
Lowest vacancy in all North America.
Soon to be a massive world city as far as tech and finance is concerned.
More people=more money=more businesses.
Landlords will be hesitant to give long leases.
I see big opportunity for inventors buying commercial property in the city.
I see even more potential for those to risk it big on development sites.
Make it or bust though.
The downtown core will soon be monopolized by a few big developers. Small-medium developers will not be able to get financing or find lots or get approvals or all of the above.