The housing market in the Waterloo Region is poised for a boost, bringing more money and new families to the area, says a recent report.
According to the Ontario Economic Update 2016, released by the Ontario Chamber of Commerce and the Credit Unions of Ontario, Waterloo is set to have one of the “hottest” real estate markets in the province.
The region is predicted to have a 6.7 per cent increase in residential home sales in 2016 to 9,600, followed by a projected 5.2 per cent increase in 2017, bringing the number of homes sold in the region to 10,100. In 2013, just 8,386 homes made it from listing to sale.
It isn’t just the number of homes sold that will go up, but also the price of the homes. The report suggests that the average price of a house will rise to $375,000 by 2017, up from $314,654 in 2013.
Ian McLean, president and CEO of the Greater Kitchener Waterloo Chamber of Commerce, says that the projected increases in the real estate market shows that the economy itself is moving forwards.
“Our region’s highly diverse and innovative economy has positioned us for sustained economic and population growth. The strong housing market indicates people are moving here for jobs and emerging opportunities,” he said.
The increase in home sales is expected to mirror the predicted increase in employment. The unemployment rate in Waterloo region currently sits at 5.9 per cent, already a one per cent drop from 2013. It is expected to fall even further in the next two years, to a low of 5.3 per cent – well below the provincial average. Across Ontario this year, 6.9 per cent of the population is unemployed.
All of these numbers come along with an increase in population, adding more than 15,000 residents to the area between 2013 and 2017.
The predicted rise in home sales and prices is based on the low Canadian dollar, low mortgage rates and mild income growth in the region, according to the Ontario Economic Update 2016. Building permits are also forecast to increase through 2017 after a lull in 2015, which the Ontario Chamber credits to large amounts of multi-unit permits issued in 2014.
None of these numbers are guaranteed, however. According to Allen O’Dette, the president and CEO of the Ontario Chamber, the projected increases all depend on government and business making the right moves.
“Ontario businesses are helping Ontario emerge stronger from the downturn,” he said. “However, our economy still faces significant challenges. In order to generate sustained economic growth, government must invest in infrastructure, close the skills gap and ensure that input costs do not stifle investments or job creation.”
Some of the job creation he referred to was cited in the report, and specifically named Toyota Boshoku Canada in Elmira when discussing investment in business. The company was used as an example of a business contributing to the growth through investment in “production capacity” and adding jobs through partnerships with government – part of the reason for a boost in real estate sales.