Report says low inventory, high demand to squeeze spring market
Almost 90 per cent of major Canadian markets saw home sales increase in January, a sign that spring activity will be challenged by a lack of inventory, according to a new Re/Max report.
The Market Trends Report 2010 found the jump in sales activity in the usually slow month of January has led to a sharp decline in active listings. In addition, threats of higher interest rates, HST and tighter lending rules have prompted buyers to act quickly. Canadian markets seeing the tightest inventory levels include Toronto, Kitchener-Waterloo, Ottawa, Victoria, Great Vancouver and Halifax-Dartmouth.
"There have never been so many motivating factors in play at once," said Michael Polzler, executive vice- president, Re/Max Ontario-Atlantic Canada. "We're in for a heated spring market that will, in all probability, spill over into the summer months as the window of opportunity draws to a close."
He added that as pent-up demand builds, frustration levels will also grow.
"For every successful offer, there are those that will walk away empty-handed. They're thrust back into the buyer pool and the process starts all over again," he said, but pointed out most purchasers are remaining cautious in their bids.