Now that 2011 has come to a close our attention must shift to 2012. 2011 has ended and in review, the year was a banner year for most markets. Sales were up, prices were up and interest rates were low.
The results of 2011 seemed to match the expectations of the development community and significantly surpassed the expectations of the analyst and financial communities.
Where are we headed for 2012?
The first indications may have been forthcoming from an investor conference in Toronto this past week where the presidents of the Royal Bank and the Bank of Montreal spoke. Both have concluded that a slump in the Canadian real estate market is looking very likely with particular focus on the condo markets in Toronto and Vancouver, where capacity is significantly overbuilt. No one is predicting a drastic collapse in prices as seen in the US, however, the excesses that they see in the Toronto and Vancouver markets are of significant concern.
So who is right ?
At this point in time it is too early to hazard an opinion. However, if the banks decide to limit their exposure to the condo market and decrease their lending activities, there will be an impact on the market.
