A report by the Urban Land Institute and PwC Canada projects that after the year of destabilizing changes this year, 2021 will be a time for embracing the uncertainty by building resilience. The optimistic report contends that people will continue seeking rural and suburban properties where they can work and play from home. As well, the 2020 jump in eCommerce will continue driving up demand for warehouse space.
On the flip side, a forecast by Moody’s Analytics estimates that home prices across Canada could drop seven per cent in 2021. These two opposing studies show that the reality of next year is truly unknown.
Brandon Vanderschot, broker/owner of the Brand Realty Group in Owen Sound, Ont., sees a changing real estate world emerging.
“In a time when we are so intimately connected via social media, the reality is we are living in a society of disconnection. As a high-value transaction, the need for the human relationship and engagement will not disappear from real estate anytime soon,” he says. “Shifting away from merely being gatekeepers of information, agents today need to realize that clients are looking for real strategic partners and advisors to help prepare, price and market their homes, commercial and investment properties. The ability to adapt and move with agility through ever-evolving landscapes and technologies will continue to give independent boutique brokerages distinct advantages by the sheer nature of their business models. Offering consistent client experiences customized to individual needs will be the difference in meeting the expectations of both buyers and sellers in the years ahead.”
Linda Currie, owner/broker of Century 21 All Seasons Realty in Woodstock, N.B., is anticipating a bustling 2021.
“It is hard to predict but with the influx of buyers coming from Ontario and west, I expect the market will continue to be brisk,” she says. “We have many prospective buyers just waiting for particular property types to become available. We have American buyers as well who were planning on a move to the Maritimes but can’t get across the border. Our major problem has been keeping the inventory available. The biggest attraction we seem to be having currently is the lower prices in our market and the lower COVID-19 cases. With so many people working from home, they can come here, buy larger properties with more attractive prices, and still work from home.”
Freddy Mak, the founder of luxury group Palace Row and real estate brokerage Ferrow Real Estate in Toronto, is confident about the upcoming year.
“I believe three specific markets will see a tremendous advancement in 2021, specifically post-vaccine – the recreational rental markets, the event space category and luxury real estate,” Mak says.
“The first category, secondary and recreational properties, will benefit from the psychology around quarantine. Consumers will feel free from isolated, segmented behaviour and will be more inclined to vacation and venture out into locations and areas that they may have previously never thought to go to. This also speaks to the second market that is poised to flourish in 2021 – the event space category. Hard-hit retail and venue facilities will likely have more competitive rates for operators. Pairing this with a now larger audience of determined experience-seekers means more venues at capacity for more days throughout the year.
“Last but not least, the luxury real estate market. We will more than likely see a huge uptick in trades and in pricing. During the pandemic, the top one per cent of the population did not have real estate investing, purchasing or selling top of mind. This will shift as big-ticket customers will begin mapping out their spatial needs, acting on their desires and creating momentum in trade volume in an already niche market.”
Christina Miller, a real estate agent with the CM Real Estate Group with Profusion Immobilier in Westmount, Que. shares what she thinks the Montreal real estate market will do in 2021: “As background, I primarily work in luxury homes sales of $1 million and up. After the real estate market opened up again in mid-May 2020 following an eight-week lockdown, we saw a lot of multiple bids. This was clearly a sign of pent-up demand. That demand has continued right through December with as many as six offers on some of our very desirable properties.”
Miller continues, “My instinct tells me that unless inventory levels pick up, this type of market activity will still be at play during at least the first half of 2021. Interest rates make it very attractive for buyers to get into the market and COVID has proven that for many people ‘there is no place like home.’”
A sales representative with Right at Home Realty in Vaughan, Ont., Ivan Bedaweed is looking forward to 2021.
“With low interest rates enticing buyers, tight supply and the strong demand seen in 2020 post lockdown, I don’t anticipate any adverse changes to the low-rise residential sector, but rather the opposite – it will pick up right where it left off in a hot sellers’ market. On the high-rise front, with the increase in rental vacancies, plummeting rental rates and vast amount of condos on the market, I anticipate that segment to continue on its current trajectory in the beginning of 2021, but begin to regain its demand later in the year.”
Melanie Dubois, operating principal with Keller Williams ConneXion and Keller Williams Urbain in Montreal, recognizes that the world has fundamentally changed forever.
“Every business sector, including that of real estate, has been radically disrupted. From a company perspective, we are focused on preparing our agents for the new world that lies ahead,” she says. “We will continue to evolve in 2021, leading to increased opportunities and challenges. We are preparing our agents for these changes by implementing proven models and systems to create stability and growth in their businesses. There is no doubt that the market will change and shift in 2021 and our strength lies in our ability to show our agents how to survive and especially thrive in these uncertain times. There is opportunity in any market!”
Elton Ash, regional executive vice president with Re/Max of Western Canada, is optimistic about the upcoming year.
“Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained. While we’ve seen a significant shift in buyer preferences this year, we believe factors such as the supply issue, pent-up demand and historically lower interest rates will continue to fuel activity in 2021. Canadians have strong confidence in the market – in fact, our recent survey found that 52 per cent of Canadians are confident that Canada’s housing markets will remain steady in 2021.”
Ash continues, “Move-up buyers will continue to drive most of the market activity in Canada; we anticipate the continuation of move-up buyers seeking out larger properties to accommodate things like home offices or home gyms. Although we’ve seen buyer preferences shift significantly this year, big lifestyle changes don’t happen overnight. In 2020, some Canadians might have made some of their real estate decisions rather quickly, and it’s likely that down the line, they could change their mind and make another move; perhaps we’ll see those who moved out of the cities make their return. Time will tell.”