These folks have some strong data to back up their predications and generally speaking, I agree with their forecast.
Jim's Market Analysis
I attended the Canada Mortgage and Housing Corporation (CMHC) presentation on the outlook for the GTA housing market late last year. These folks have some strong data to back up their predications and generally speaking, I agree with their forecast.
If you look at the 1st slide, you will see the basic sentiment they have. Namely, "Slow and Steady" for the year ahead. No big changes, no dramatic decrease or major appreciation's on the horizon for 2014. Personally I see this as a "good thing" as we cannot sustain the significant appreciations we have been seeing in the past without some sort of correction occurring. That is, prices cannot keep rising in the 5-8% range annually without some sort of pull back. As CMHC predicts, a "Market in Balance" is a good thing for us all as home owners.
The comment in the slide that states "The condo market is adjusting" means that new condo launches have markedly decreased (all those cranes that you see around us are projects that were launched years ago). So, this means that the market forces are self-correcting, again a good thing.
The 2nd slide gives you a visual of what to expect this year: Similar numbers of MLS transactions occurring in 2014, MLS prices will only appreciate modestly (think in the 2-3% range and keeping with GDP growth), new construction starts will moderate and the vacancy rate for rentals will increase slightly (albeit, the vacancy rate in the GTA is presently quite low - in the 1.7% range).
My own 2 cents to add to this general forecast are these:
Condo unit appreciations will lag when compared against traditional freehold housing (they are not making any more land but can continue to build into the sky).
This pattern will likely continue for the next number of years ahead (simply a supply - growing supply - and demand equation here).
So, if you are thinking of selling your condo and moving to a house, the near future is probably your best time to do so as the "gap" between these 2 categories of housing grows.
If you would like to view all the slides from the CMHC presentation, you can find them on my website: www.phoebecondos.com. Alternatively, if you want to discuss this information in more detail, feel free to reach out to me at firstname.lastname@example.org and we can arrange a convenient time to chat in more depth.