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Canadian Real Estate Investment Market Opportunities in 2021

Canadian real estate investment market opportunities in 2021? From adversity, there is an outgrowth of opportunity from COVID 19 giving Canadian property investors reasons to smile.

Cities are out – suburbs and rural living are in

According to PwC Canada’s Workforce of the Future survey, September 2020; 63% of the workforce like working from home and either want to stay put or balance home/office time.

  • 34% of employees prefer remote work
  • 37% of employees want to work in the office most of the time
  • 29% of employees want to work from home 50% and remotely 55%

Working from home took commuting out of the work equation, making people take stock of their quality of life. This led them to buy homes in areas they love or to buy bigger homes in suburbia or rural locations. In Ontario, many decided to relocate to more affordable communities such as Woodstock and Bancroft, Ontario, which realized increased home prices from 24.3% – 28.4%. If you’ve always wanted to live in a larger house in the suburbs or the country, now is the time to seize the real estate investment opportunity.

Mortgage rates at unprecedented low – great news for Canadian real estate market investment opportunities

For the first time in Canadian history, HSBC has posted a variable five-year closed term mortgage rate of 0.99% for buyers with less than a 20% down payment. Banks have been jumping through hoops to compete for business, and many offer fixed-rate loans in the 1.5% range. The Bank of Canada has aggressively slashed its rate to close to zero and announced it would remain there until 2023. If you’ve had your eye on a bigger house, or a real estate investment property, you can borrow money on the cheap.

Very few foreclosures

Surprisingly, not many mortgages have foreclosed. Of RBC’s deferred mortgages, only 2% foreclosed. Of that 2%, 1/3rd were delinquent before the banks initiated deferral programs. People have shown their resilience and figured out how to sustain their mortgages.

Online shopping- opportunities for warehouse space

During the pandemic, eCommerce satisfied our psychological need for safety and fulfilled our basic food and household necessities. COVID – 19 fast-tracked the demand for eCommerce, which created a demand for warehouse real estate. For those looking to expand into commercial real estate investments, 2021 is an opportune time to investigate or invest.

Limited hospital space and an aging population- the need for physical health space

The pandemic and the aging population have increased the health services’ pressure, which created a shift to virtual health services and physical health care space. We have already started to see the repurposing of retail locations into health care facilities, which may create more opportunities for additional community health care spaces.

Detached and semi-detached houses – hot Canadian real estate investment opportunities

The Toronto real estate market saw a 25% increase since 2019, and the average price of a detached home jumped up to 14.8% from October 2019. The price of an average Vancouver home escalated by 5.8% from November 2019. In Calgary, The Calgary Real Estate Board (CREB) anticipates a 5% increase in housing prices from 2020. Montreal saw an increase of 17% in single-family homes and 14% for condos in 2020.

According to the report – the top Canadian real estate investment market opportunities markets for 2021 are Vancouver, Toronto, Montreal, Ottawa, and Quebec City. If you have the resources or can borrow them, the prairie provinces and the Maritimes, are good places to buy and hold.

Adversity brings opportunity. Overall, the pandemic increased industrial real estate investment opportunities and provided investors with opportunities to borrow money for residential properties with the best mortgage rates in Canadian history.

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