There’s been a lot of talk about real estate in the news in recent months. We’ve heard about declining housing starts, falling existing home sales, double-digit price depreciation, subprime fallout and foreclosures in the United States.

Fortunately, we live in Canada. And Canadian real estate markets are far-better positioned than their American counterparts for a good number of reasons.
1.      Subprime mortgages represent less than five per cent of our market nationally.
2.      Foreclosures occur in about one quarter of one per cent of mortgage transactions in this country.
3.      Canadians have more equity in their homes.
4.      We have less debt than our neighbours south of the border.
5.      Speculation has played little or no role in existing home sales in Ontario.
6.      The fundamentals of our economy are relatively solid. Of the G8 countries, only Canada is expected to show growth in 2008 and 2009.
7.      The Canadian banking system is one of the best in the world, relying more on old-fashioned lending than innovative financial products geared toward profit.
8.      The Canadian job market is stronger than the US, adding more than 200,000 jobs so far this year.
9.      Interest rates remain favourable.
10.   Housing values in Ontario major centres did not experience serious, double-digit price appreciation year-after-year for an extended period. Our markets were characterized by stable, healthy growth.
11.   Immigration continues to play a key role in housing markets. Between 2001 and 2006, more than 1.1 million immigrants came to this country, with about half settling in the province of Ontario. Immigrants tend to purchase a home within the first five years of living in Canada.

Real estate is cyclical. There will be peaks and valleys. The more restrained the peak, the more modest the valley.
There is no question that market conditions have moderated from 2007s record pace. More listings, softer housing values, longer days on market but most centres are relatively solid. While some buyers and sellers will adopt a wait-and-see attitude, there are those that will continue to venture forward.

Understanding market conditions will be of paramount importance to today’s buyers and sellers, especially as conditions change in markets across the country.  Gone are the multiple offers that left both buyers and sellers dissatisfied. The increase in the number of homes listed for sale are a definite advantage for purchasers who now have the luxury of time in making one of the most important decisions of a lifetime. For sellers, the time to trade-up has never been better.

Canadians are great believers in homeownership a fact underscored by the close to 70 per cent who own homes in this country. History has proven time and time again that real estate is a solid, long-term investment that appreciates at a rate of about five per cent annually. You can’t live in your mutual fund, and after the last month in the financial markets, quite frankly, were not sure you’d want to.