There is no normal anywhere..
Shall I regale you with stories about how crazy this real estate market is?
There is not much point. If you’re thinking about taking the cold bath of buying in this market, you already know what you’re up against. It’s a battleground out there.
Kingston experienced one of the highest rates of real estate appreciation in Canada in 2021 - over 40 per cent.
The limestone city was already in a cycle of low supply when the pandemic hit.
Then the eyes of freshly minted work-from-homers fell on Kingston and its two-hour drive to three of Canada’s largest cities.
Toronto residents in particular have headed down the highway to Kingston, lured by home prices that were bargains by their standards. In many cases, locals were priced out of the bidding wars.
Now the average single-family home price in Kingston looks more like Toronto at over $700,000.
Prices won’t moderate much until we have more housing supply and that will take a few years to even start improving, especially with immigration levels at all-time highs. Beyond that, it’s like trying to predict the stock market.
But a housing crisis is boiling, and that is forcing governments to move boldly. Here are two major policy changes that have increasing support at both the federal and provincial level that will likely be part of our real estate future.
Allowing low-rise apartment buildings in any single-family neighbourhood.
The Ontario government’s 2022 housing report has advised increasing housing in urban areas by phasing out low-density zoning areas. This would mean if you have a home in a suburban neighbourhood, and someone buys the 60-foot lot next door, they can tear down the little post-war house and build a multiplex beside you.
Nixing the capital gain exemption for principal residences
This change is likely to be phased in eventually despite every politician swearing they won’t. It could take a form similar to the U.S. approach, which is an exemption on the first $250,000, or $500,000 for a couple.
The country is drowning in debt, millions of homes short, trapping people in sub-standard housing & stressful personal situations because they have no other choice.
Something’s really gotta give.
Just a few things to keep in mind as you plan your real estate moves over the next few years!