The coronavirus outbreak turned the world upside down, affecting all countries equally and causing quite a stir on the planet. On a smaller scale, it has changed people’s daily lives, but on a larger scale, it has collapsed the world economy, causing companies to face extreme challenges to survive.
The real estate market may not see the consequences of the virus immediately. This does not mean that Toronto property prices may suffer a drastic drop, although that remains to be seen.
The rampant effects of the pandemic have caused the loss of jobs and sharp falls on the stock market, making a slowdown in the real estate market possible.
Some factors may determine how Toronto real estate prices will be affected by the coronavirus:
The Real Estate Industry Continues To Operate
The provincial government in Ontario announced that essential services might continue to operate during the corona virus pandemic. These include land registration services, moving services and real estate offices.
Other essential services required to buy and sell a home include financial institutions and law firms that continue to provide their services.
One of the big problems may be the shortage of resources to buy or sell a house, but it can be solved. Buyers and sellers will have the support of their financial entities or jobs to solve this problem.
This will help demand continue on its current path, thus helping the real estate market not to decline at any time. If there is a slowdown in the market, the seller can stop the action and wait for the COVID 19 pandemic to pass.
The Duration Of The Pandemic
The Toronto, real estate market will reflect a drop in sales if current social distancing measures continue for an extended period. The uncertainty currently causing the pandemic may lead some people to give up buying houses.
Investments have lost value, and jobs have been lost in certain industries. These are factors that could limit people’s financial power, therefore reducing the demand for housing.
Lower interest rates
Toronto property prices are unlikely to fall unless sellers are upset by selling now and cannot wait for the pandemic to end. For their part, buyers increase their savings by taking advantage of the low-interest rates that banks currently have.
An example is the Bank of Canada that, due to the pandemic, announced a decrease in its reference interest rate, leaving the current rate at 0.25%. Buyers take advantage of this to ask for money used to pay lower interest mortgages over time.
The Canadian government is also quickly taking steps to help lessen the risks, with various benefits that will help companies avoid exemptions and keep their employees on the payroll.
Real estate agents are using technology to adapt
Before the entire pandemic, the real estate industry created policies to help buyers feel more comfortable and secure when visiting potential homes. These were to disinfect doorknobs, countertops, and other high contact areas before and after each open door visit.
Then the severity of the problem developed quickly, causing the Ontario Real Estate Board (OREA) to suspend visits.
Technology has been of great help at this time, facilitating the purchase and sale of real estate, thus limiting contact between people; this means that there is no need for sellers to lower their prices.
There are tools available that lead people to search for houses online, go through it, and then use electronic signatures in the purchase-sale document. The entire process has led agents to use Zoom or similar platforms.
With these platforms, cancelled open doors are no longer a problem and a possible market crash using technology to help buy houses without the need for essential physical contact.
This trend can continue, preventing sellers from lowering their home prices or withdrawing their listings from the market. Additional measures to protect home buyers and sellers include business agents facilitating the process of this purchase via the Internet, without any complications.
The possibility that the Toronto real estate market is affected by the coronavirus pandemic is not ruled out. This is why real estate agents use technology to mitigate this impact and thus help solve the crisis.