After the rough ride of the last two years, we are all trying to figure out what the future has in store. To help with this difficult task, the Real Property of Association of Canada (REALpac) and FPL Advisory Group have released their survey of the sentiments of the real estate industry in the first quarter of 2010.
Image: Josh Dubya / Flickr
The good news is that most experts agree 2010 will not be like 2008 and 2009. Both of those years were very weak in terms of real estate performance, although 2009 saw some positive news toward the end of the year. But overall, it’s clear that the recession was not as harsh as experts projected it would be, and the one in Canada was milder than the one the U.S. experienced.
The results from the survey show that many real estate professionals are more optimistic. The Real Estate Sentiment Index hit 76, up from 68 in the previous quarter and 50 in the quarter before that. The Index is on a scale from 0 to 100, with 0 indicating no confidence in the real estate market, and 100 indicating that all of the respondents feel that the real estate market is “much better” compared to this time last year, and that it will be “much better” in a year’s time. The increase in optimism generally resembles how the U.S. feels; however, Canadians overall are more optimistic.
Real estate professionals were also optimistic about lending conditions continuing to ease in the near future, and that there will be increased sales activity in the coming year. Most of them see a slight recovery in 2010, but that this recovery will get stronger in 2011 and 2012.
However, there are some checks on this optimistic outlook. There are not a lot of large-scale transactions occuring, and the number of sales is still weaker than usual. As well, the U.S. still has a lot of work to do before it is back on solid economic footing, and weakness there can spread north.
In other words: things should get better this year, but don’t expect anything too spectacular. As always, although it is a good idea to get as much information about the market as possible, your individual decision to buy or sell should be based on your own personal situation. Take this view of the market as just one of the factors influencing your overall decision.
Heleen Jacobsen
Broker of Record with InfoMarket Group GMAC Real Estate
www.infomarketgroup.com
