Is it a bubble?

Friday Mar 05th, 2021


A quick glance on what happens in the Real Estate market today it sounds like a bubble but the reality tells us something different! There're many reasons that it's not a bubble. 

First cardinal reason is: That we have a very low inventory , which makes the supply away lower than demand. Technically speaking, in Real Estate , we call it  monthly supply of inventory, it means the number of houses for sale compared to the number of Buyers in the market. In GTA the maximum was 1.6 month and could be less.  One of the reasons here is the Covid 19 that intimidates many home ownwers to consider selling. 

Second cardinal reason: That it's a real demand , according to the Bank of Canada 's CEO expression "exuberance" also the Buyer's psychology plays a tremendous role to buy without any serious consideration except that the house prices will keep going high endlessly.  Also needelss to remind you that the Millinnials start to create families and need places to reside.   And on the top of that, Bank of Canada will keep a low interest rate till a full recovery of the nation economy! 

Third cardinal reason: Canadians have saved a significant sum of money< some statistics had shown that Canadians could save $100 B over a year or a little bit more.  Too many of them , will invest in Real Estate , 

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