but will 2021 be much different?

INDUSTRY UPDATE Good riddance 2020, but will 2021 be much different?

Well, 2020 is finally over. Now what?

Amidst all of the New Year’s memes and Facebook posts talking about forgetting 2020, I can’t help but think that 2021 will not be much different – except perhaps I don’t have to worry about running out of toilet paper.

With the information at hand, what can we speculate will happen within the context of real estate in 2021?

More people than ever are re-evaluating where they want to live now that they have to (or have the ability to) work from home. This large shift in new buyers and sellers in the market has caused the value of real estate, particularly detached and townhomes, to rise in value. This is especially the case in suburban markets.

Condos, particularly in major urban centres, will remain flat, or possibly show small declines (especially in downtown markets like Vancouver and Toronto). Many professionals are struggling to get comfortable working eight hours per day from home and are seeking a larger space. Plus, the idea of touching the same door handles and elevator buttons as hundreds of other occupants during a pandemic is a very real health concern.

Interest rates will remain at all-time lows as governments and markets will keep downward pressure on rates.

Certain sectors will overperform (technology, delivery services, etc.), pushing up the need for industrial warehouses for online shopping. Others will struggle to make ends meet (restaurants and bars, live entertainment, etc.), decreasing retail lease rates and valuations significantly.

BY KYLE GREEN Owner of the Green Mortgage Team

Jobs in most white-collar industries will be largely unaffected as most can work from home, while a disproportionate number of blue-collar and especially unskilled service labour will suffer. This means there is a general expectation that office space lease rates and values will also dip; however, not as much as retail.

What should you do?

If you are planning to purchase a detached home:

Be prepared to be armed and ready. You will likely be bidding with many other buyers, many of whom will be taking the risk and writing an offer without subjects. To learn more about how you can position yourself to do this safely, reach out to our team.

If you are planning to purchase a condo: The market is and will be softer for a while. Nonetheless, I see a rebound in condos within approximately two years when COVID-19 is in the rear-view mirror and immigration resumes. Immigrants tend to be drawn towards downtown cores, which should bode well for the Vancouver and Toronto markets in particular.

If you own a property or multiple properties:

Consider refinancing to save thousands of dollars on your current mortgage. If you have not already done this, ask our team to run the numbers to see if it makes sense to refinance your mortgage. We have helped clients save over $30,000 by refinancing. It is certainly worth exploring whether this fantastic opportunity makes sense for you.

If you own a business: Accumulate cash and prepare for a rainy day.

If you are a real estate investor: Be on the lookout. Low mortgage rates have made it much easier to cashflow deals.

My advice: Stay cautiously optimistic! What else is new?

One of the Green Mortgage Team’s goals for 2021 is to enhance the customer experience. We have created a new “roadmap” to give our clients a better idea of which team members they will be dealing with during the mortgage process, automatic updates of where they are at in the process as new milestones are hit, and information such as how long it typically takes to reach the next milestone. The Green Mortgage Team Residential Roadmap is being rolled out starting in January.

We would love to hear your feedback as we endeavour to deliver the best customer experience in the industry. Please do not hesitate to reach out. We are determined to set ourselves apart!

Let’s make 2021 the best year yet,

Kyle Green