Buying Property in Cooling Canada

With America’s sub-prime housing crisis raging on and its economy showing serious signs of a slowdown, many would be investors in the North American property market are likely getting a bit antsy about the future.  If you’re eyeing Canada for its investment, growth and tourism potential, relax.  Reports of a slowdown are accurate, but the big picture paints a much rosier 2007 than a single quarterly report.  America’s ongoing issues do not seem to be taking a very big toll on its neighbour to the north.

In this article, we’ll take a closer look at buying property in cooling Canada and the Canadian property market in general.  Whilst there has been a bit of a cooling, savvy investors will quickly see the sluggishness only represents more potential in the face of other factors.

Concerns about a property market crash have had some investors quaking a bit in their boots.  Whilst third quarter housing sales are down 3.2% from the second quarter, the news isn’t that bad, according to the Canadian Real Estate Association.  It seems the second quarter results were the best the country has ever had.  The first nine months of the year showed recorded sales of more than 419,000 properties.  This was an increase of 8.4% over the previous year.  A total of 213,547 new listings went on the market in the third quarter, which is the second highest level ever.

As sales slowed in the third quarter, prices did not.  The average sale price within the country fell in at just over CAD 308,000.  This showed a total increase of 11.7% over the previous year.

The Canadian Real Estate Association says that in spite of the third quarter dip, Canada is heading toward its best year ever.  Even if it falls short, the market hasn’t hit a serious slump by any means.

With tourism in Canada on a steady upswing and prices here still relatively low in comparison to other parts of the world, the market remains of interest to foreign investors.  Canada as a whole holds a 2.9% share of the world’s total tourism demand, according to the World Travel & Tourism Council.  The country is anticipated to see a growth rate in tourism of about 4.7% per annum through to 2017.

Considering the tourism demands, the slowdown might actually be good news for some investors.  If sales continue to dip, prices are likely to fall a bit in the process.  This means that those with a desire to buy-to-let and even buy-to-hold are likely in for some savings.  Relatively fast turnaround for profits remains a possibility in areas of high demand.

Canada is more than holding its own as its southern neighbour struggles.  Investors interested in this expansive country are likely to find it remains appealing for quite some time to come.