When March began, the Toronto real estate market was still growing at an exponential pace, and many real estate transactions throughout the city were in various phases of completion - from buyers scheduling showings to properties physically changing hands. Once COVID-19 came to the GTA and lockdown measures were mandated however, the real estate industry more or less ground to a halt.
As the situation has continued to develop, Bosley has remained a leader in the real estate field by providing quality market information and leading their team to adapt business practices quickly and without pause. Being able to rely on a diverse network of contacts with whom to share market insights has also given us a broad understanding of the current conditions in play - and allows our agents to better serve you regarding your real estate goals.
One of these valued contacts is mortgage architect Joe Sammut, who was kind enough to offer his inside observations regarding the current state of real estate transactions in the GTA during COVID-19.
New Business Stalled
For starters, selling property in Toronto is now no easy feat. As the city rushes to adapt to the realities of the pandemic, practices like live showings have quickly become last resorts subject to strict safety precautions. Homeowners looking for financial relief from the pressures of the lockdown, on the other hand, were granted a much-needed reprieve when Canadian banks issued a moratorium on mortgage payments. Under normal circumstances, this might cause an influx of new business, but according to Sammut that just isn't the case.
"We've been fielding a lot of calls from people looking for some clear answers to a lot of the misinformation that is being spread,” Sammut shared. “Refinances are at an all-time high while the purchase business has dropped slightly."
A House of Cards?
While those seeking to refinance attempt to take advantage of reduced interest rates, the increased safety precautions surrounding the real estate process have frozen some buyers and sellers in place for the time being - unsure of their next move. With slow-paced and safety-cautious transactions costing the market its momentum in the wake of the pandemic, there exists a possibility that the banks' mortgage holiday could affect in-progress refinancings - thus, impacting the integrity of the real estate market long-term.
"I'm hearing that it will impact people's ability to refinance if they are currently in a Deferred Mortgage Payment set up," Sammut says, "But if it's due to job loss, that has more of an impact than the Deferral itself."
With millions of Canadians now unemployed, the need for financial assistance and strategies for recovery is greater than ever. Though Sammut says he knows a mortgage holiday will cost the consumer additional charges over the life of the mortgage, he feels it is a measure that can award them the peace of mind and security of not having to make a payment during these times.
On the other hand, for those who have had a house on the market for the duration of COVID-19, rather than fret about your home's perceived loss of value as you wait for an interested buyer, remember that demand in the city is still high - and price adjustments tend to fluctuate.
"I believe it will prove to be regional or neighbourhood-related adjusting if anything," says Sammut. Stay tuned to find out.