Posted By Peggy Hill on November 19th, 2010
Throughout 2010 the Barrie economy has been recovering from the recession, this trend will continue into 2011 but at a slower rate of recovery. According to the Housing Market Outlook from the Canadian Mortgage and Housing Corporation (CMHC), employment levels will almost meet pre-recession levels by the end of 2010. The increase in employment will continue into 201, but at a reduced growth rate.
Full time employment is recovering for the considerably large 25-44 age group. This group will begin to grow again in 2011 increasing the number of first time home buyers. The recovery is lead primarily by the Services sector as these industries are showing the most strength and generally have higher wages. The employment level on a whole rose nominally from 2009 to 2010 but is forecasted to increase by 1.6% in 2011. Migration into the Barrie area, which has historically increased the labor force, will be more reserved. The increase in the labor force will instead come from local residents either re-entering the work force or entering it for the first time, resulting in a slight decline in the unemployment rate.
The CMHC predicts that mortgage rates, although higher than the low in 2009, will remain relatively flat from the last half of 2010 into 2011.
What does this mean for Barrie Real Estate?
Price growth, which has been quite strong through 2010, will continue to grow in 2011 but at a much slower rate. Because of this the market will move towards a more balanced state between the buyer and seller.
New Home starts will stabilize from their lower levels in 2010, increasing near the second quarter of 2011, as the economy strengthens and the resale market tightens. The increase in new homes will be lead by Single detached housing. Row homes will continue to take about 12 percent of the new homes market while semi-detached homes are forecasted to halt completely.
On a whole this means that the housing market will begin to stabilize. Existing home sales and new listings will continue to increase from 2010 into 2011 but at a more gradual growth rate. Sales in the resale market will begin to increase by the end of the first or second quarter of 2011 as the Barrie economy continues to improve. On average mortgage rates will continue to be low into 2011 and the costs of home ownership will still be slightly lower in 2011 than pre-recession rates. This coupled with slow wage growth will moderate sales in 2011 as the market begins to settle into a more balanced state.
For more information or advice, please feel free to e-mail me. And, if you know anyone else who could benefit from this information, please share this with them as well.
Sincerely,
Peggy Hill
Peggy Hill & Associates Realty Inc., Brokerage
Office: 705-739-4455
Mobile: 705-796-8191
