Grab your board, sunscreen, beach towel and a floppy hat! Surf is up in this coastal paradise called Dominical, Costa Rica. Dominical has a refreshingly relaxed vibe with incredible surf, local craft breweries, and some of the most amazing local artisanal coffee products. The sleepy but vibrant coastal town of Dominical is the beach-lover’s hidden gem in Costa Rica. Situated in the South Pacific region on the lush Costa Ballena, Dominical can be described as the perfect balance between wild nature and modern comfort.

SAM SHALOM

Grab your board, sunscreen, beach towel and a floppy hat! Surf is up in this coastal paradise called Dominical, Costa Rica. Dominical has a refreshingly relaxed vibe with incredible surf, local craft breweries, and some of the most amazing local artisanal coffee products. The sleepy but vibrant coastal town of Dominical is the beach-lover’s hidden gem in Costa Rica. Situated in the South Pacific region on the lush Costa Ballena, Dominical can be described as the perfect balance between wild nature and modern comfort.

Due to the peaceful nature of this town, you are sure to encounter on wildlife, such as iguanas and maybe even a sloth hanging above. If you spot a monkey, hold your belongings tightly … they are the adorable bandits of Dominical! Although the most popular activity in Dominical is surfing and relaxing at the beach as you watch the ocean’s waves crash onto the rocky shore, there are also plenty of other activities to entertain as well. Spend your day zip-lining through Manuel Antonio National Park, or head for a relaxing view and a dip in the Nauyaca Waterfalls. Whether you end the day winding down at the world-class yoga studio in town or with a cocktail back on the beach, you are doing it right! Read more about the uniqueness of this blissful beach town, straight from our Costa Rica expert Daveed Hollander!

Where do you live: Where the mountains meet the deep blue Pacific Ocean along one of the most majestic coasts lines of Costa Rica, the Ballena Coast

What is the perfect weekend day like: We start by walking up to some of our local coffee shops. Dominical is home to some of the most amazing local artisanal coffee. From there, we normally head out for a morning walk along the sandy beaches of Playa Dominical or Playa Chaman, known to be the annual breeding grounds for many varieties of whales. After a short hike, we paddle board or surf depending on ocean swells in the small cove of Playa Dominicalito. After the morning surf, we usually head to the mountains, about 20 minutes away, to eat at one of the many local spots that are along the rivers and offer swimming holes and waterfalls to cool off in. From there, we head back to the house and spend an afternoon with family— enjoying the cool breezes of the Pacifica and listening to the abundance of wildlife from the mountainside. When night falls, we head downtown for drinks at the local brewery or one of our favorite local spots on the beach. Depending on whether you have kids or not, you may continue to have a few drinks at the local bars but with kids you may head to the beaches to enjoy the sunset and a summertime bonfire on the sand.

What are the common modes of transportation there: There are numerous means of transportation but the most common for locals and tourists alike are the amazing and easy to use bus systems. Though cars and off-road vehicles are a huge part of the culture and during the summer months is it very common to see tourists and locals riding 4 wheelers and scooters from beach to beach. 

Tell us about the foods your area is known for: Costa Rica is filled with amazing food, but the Ballena Coastline has a rich food culture with so many different international flavors.

What is your favorite meal? At home or at a restaurant: One of my favorite meals is the fresh curry veggie bowl with Seared Ahi tuna at Scala. For a great Pad Thai and glass of wine, check out Citrus on the weekends.

Where do you recommend someone vacation in your region, why: There are so many amazing areas to choose from. The hills sides are scattered with amazing rental homes and boutique hotels. The beaches of Uvita are amazing and will never disappoint. While the white sand of Manuel Antonio is great for families. There are several marinas and waterfalls to frequent.

What is your favorite recreational or leisure time activity: Costa Rica is known for the waves and surf, deep-sea fishing, and hiking. I frequently surf with my son and daughter. There is so much to do in a small radius.

Is there a specialty your area is known for: Costa Rica and especially the southern zone of Costa Rica is known for having some of the best coffee and chocolate coming out of the valleys of San Isidro. You have to find small chocolate makers and boutique coffee farms scattered along the hillsides.

Share a little known but interesting fact about the area/region: In 2018, Costa Rica will mark its 70th anniversary since it abolished its military, and that seems to suit the population. It ranked first in Latin America and 12th in world in happiness, according to the 2017 World Happiness Index. The Happy Planet Index ranked it No. 1 in the world.

If you were to live in any other region where we have a Coldwell Banker presence, where would it be and why: If I was not here along the amazing coast of Ballena, I would live in the snowy hills of Chile’s Patagonia, with roots in California and Costa Rica always.

Territory Summary:

“The pleasant town of Dominical is relatively small but offers the beach-lover a wide variety of nearby beaches to choose from. Playa Dominicalito is just south of Dominical and is a great spot for beginner surfers and swimmers. At Punta Dominical, on the southern end of Playa Dominicalito, you’ll see the lush green land merge with the rich blue Ocean. It is a great spot to watch the ocean’s waves crash onto the rocky shore below and see a near perfect sunset almost year-round. Other activities include treks to nearby waterfalls including the Nauyaca Waterfalls (7.5 mi from Dominical on Hwy 243), canopy tours, horseback riding, deep sea fishing, sea kayaking, scuba diving and snorkeling. For attractions in the surrounding areas you can access Chirripó National Park by traveling along Hwy 243 towards San Isidro about 31 miles (50 km). Access to Manuel Antonio is possible by traveling 23 miles (37 km) north along Hwy 34. To the south 95 miles (152 km) lies Golfito and access to Corcovado National Park.”

Key Facts:

• Population: Puntarenas Province: 410.929
• Language(s) Spoken: Spanish
• Climate: In Puntarenas, the wet season is oppressive and overcast, the dry season is muggy and partly cloudy, and it is hot year-round. Over the course of the year, the temperature typically varies from 77°F to 97°F and is rarely below 74°F or above 99°F.
• Currency: Colones

Industry Facts:

• Types of Architecture: Organic architecture style in luxury properties
• Price per Sq. Ft/Meter: $169
• Average Sale price: Average Asking Price (New Listings): $654,000

Wendy Helfenbaum

When inventory is low and buyer demand is high, chances are you’ll receive at least one cash offer—a promise to purchase your property that doesn’t depend on the buyer acquiring a mortgage. Buyers figure paying cash might help them stand out among multiple offers, but what’s in it for you as the seller? Here’s what sellers need to know about all-cash offers.

What is a cash offer?

Most offers on residential homes typically include three conditions: financing, an inspection, and a review of documents. When an all-cash offer is submitted, the buyer is telling the seller they have enough cash and investments to purchase the property, says Rochelle Cantor, a REALTOR® and broker with Engel & Völkers in Montreal.

“A cash offer doesn’t mean someone is going to go to his bank and pull out a whole bunch of cash,” she says. “In the eyes of a vendor, the buyer is showing you they’re good for the money and they’re a very strong buyer.”

Cash buyers can be investors purchasing homes in poor condition that wouldn’t otherwise qualify for a mortgage, or buyers who don’t need financing because they’re wealthy or have lots of equity after selling their own home.

Sales may close faster with cash offers

To sellers looking for a quick transaction, an all-cash offer is especially enticing, says Cantor.

Before a buyer’s mortgage approval is finalized, lenders require an appraisal—banks need to ensure the property is worth the purchase price before securing the loan. 

“In this market, even with a mortgage pre-approval letter, it can take 14 days to get financing approval, which locks up your house and can take away the momentum of the property being new on the market,” says Cantor.

However, with an all-cash offer, no appraisals are required, because the buyer isn’t borrowing money from the bank.

How buyers prove their all-cash offer is viable

With cash offers, the promise to purchase will include a clause noting the offer is conditional on providing proof of funds, notes Cantor.

“I suggest my buyer clients ask their bank or investment advisor for a signed letter on their letterhead, stating how long they’ve been a client of that institution, they’re in good financial standing, and they have cash and/or investments in excess of X amount of dollars for the purchase,” she explains.

Most sellers will give a buyer several days to obtain this proof, but savvy buyers show up with an offer and a proof-of-cash letter in hand in excess of the amount they’re initially offering. 

“For example, if somebody’s buying a property for $1 million, we don’t know where we’re going to end up after negotiating, so it’s better if you provide a proof-of-funds letter exceeding what the actual offer is. Then, the seller knows you’re really good for the money. Proof of funds is a very powerful thing for a buyer and it’s a wonderful thing for a seller.”

Of course, just because buyers can show they have a lot of money doesn’t mean they’ll spend that much more on your property, she adds.

Should sellers ever refuse cash offers?

“Giving an all-cash offer doesn’t mean the buyer is a criminal trying to launder money,” says Cantor. 

That said, FINTRAC’s Operational brief: Indicators of money laundering in financial transactions related to real estate does list “unusually large cash amounts used to fund any financial aspect of a real estate transaction” as a possible indicator of a suspicious transaction. If the offer doesn’t make sense in light of what you know about the client and the transaction, you may wish to file a suspicious transaction report.

Further, be aware buyers may come in with a lower offer, using the cash-only incentive as leverage. 

“I recently gave an offer that had basically no conditions and proof of funds, and I told the broker, this may not be the price your client was hoping for, but it’s done, and the covenant of the buyer is as solid as you can get, which is really important.”

If you’re about to list your property on the market, it’s smart to work with a REALTOR® who understands how to navigate all-cash offers. Together, you can decide the best path to selling your home.

REALTOR.ca Team

The last two years have had many Canadians feeling like they’re stuck in Groundhog Day, as two stories continued to dominate headlines: COVID-19 and Canada’s housing markets.

The year 2021 was another record-breaker for both home sales and price growth, according to data from the Canadian Real Estate Association (CREA).

This trend kicked off in January as the sales-to-new listings ratio hit an all-time high of 90.7%. Home sales started strong, 35.2% higher than January 2020. By April 2021, home sales skyrocketed a whopping 256% compared to the same time in 2020 (which was when most of Canada was under some kind of lockdown).

Markets seemed to be calming down as we welcomed summer’s warmer weather back. Home sales fell 8.4% in June on a month-over-month basis but were still up 13.6% on a year-over-year basis.

In August, markets continued to stabilize. While levels were more normal compared to earlier in the year, they were still quite active compared to any other point in history.

By the end of October, Canadian home sales had set a new annual record.

National home sales remained historically high in December 2021, yet Canada’s housing supply hit an all-time low, meaning home buyers were left feeling the squeeze heading into the new year.

CREA recently reported the actual (not seasonally adjusted) number of transactions in December 2021 was the second-highest level on record for the month, with only December 2020 coming in higher.

(Click the image to download the high-resolution PDF)

Because of short supply and high demand, the actual (not seasonally adjusted) national average home price climbed to $713,500 in December 2021, up 17.7% from the same month last year. Excluding the Greater Vancouver Area and the Greater Toronto Area, which heavily affect Canada’s national numbers, the national average price comes in closer to $560,000.

The MLS® Home Price Index (HPI), which uses more than 15 years of MLS® System data and sophisticated statistical models to gauge a neighbourhood’s home price levels, rose 2.5% month-over-month in December 2021. This is on top of similar gains to the MLS® HPI seen in October and November.

“Those are big gains,” said CREA’s Senior Economist and Director of Housing Data and Market Analysis Shaun Cathcart during CREA’s monthly housing market report. “Taken together, that’s about a $60,000 increase on the national benchmark price just in those three months.”

The MLS® HPI was up 26.6% on a year-over-year basis in December.

Overall, home sales increased 20.7% across Canada in 2021, compared to 2020. Meanwhile new listings were down 8.9%.

“With the housing supply issues facing the country having only gotten worse to start 2022, take any decline in sales early in the year with a grain of salt because the demand hasn’t gone away, there just won’t be much to buy until a little later in this spring” said Cliff Stevenson, Chair of the Canadian Real Estate Association. “But when those listings eventually start to show up, the spring market this year will almost certainly be another headline grabber. If you’re thinking about jumping into the market as either a buyer, seller or both, your local REALTOR® has the information and guidance you’ll need to navigate the market in these unprecedented times,” continued Stevenson.

Stay tuned for our monthly Housing Market Snapshot to keep a pulse on the market.

Remember, contact a REALTOR® for detailed information about your neighbourhood and its price trends.

The spring housing market is often regarded as one of the busiest and most important times to buy or sell a home. 

With increasing inflation, rising property prices, and record-low housing supply, the 2022 spring market could be a challenge to navigate without the skills and knowledge of an experienced REALTOR®.

Today, we speak with Davelle Morrison, a Toronto-based REALTOR® and broker with Bosley Real Estate and Alex Yao, a REALTOR® with RE/MAX Select Properties in Vancouver to hear what they predict  home buyers and sellers could expect this spring.

What we can generally expect from a spring market

Some may consider the spring market to occur between March and May. However, Morrison points out the spring market can start as early as January after home buyers have spent holiday downtime surfing REALTOR.ca and evaluating their plans for the new year. 

“If I were advising a client who has a listing, I would say get out there in January and February, because that’s when there really aren’t a lot of listings, but there’s a lot of demand,” she said. 

The COVID-19 pandemic knocked the market out of its regular seasonal patterns in 2020, capsizing the spring market to seasonally low sales levels and pushing transactions into the summer and fall markets. 

Yao explains affordability and the work-from-home movement will continue to play a role in influencing buyer activity in spring 2022.

A large part of the Vancouver market is made up of families with children seeking more space for greater affordability, Yao said. Many households are moving to the outskirts of the region to communities such as Coquitlam, Surrey, and Maple Ridge, which can be more affordable than metro Vancouver. 

The timing of the spring market and how it coincides with the school year will also be a convincing factor for families to move. 

“Spring has always been a family type of moving period because as they’re getting ready to move—going to make a purchase or sale of a home—they’re lining up the move around the summertime when the kids are out of school,” said Yao. “Typically, that purchase or sale has to happen in the spring to line up for a move in the summer.” 

For those living in outer-city communities who may be required to return to their downtown office, Morrison says busy road traffic and long travel times may persuade buyers to pick up a pied-à-terre condo to make their commutes easier. 

Housing supply has been hovering around extreme lows for some time. In its December 2021 housing market update, the Canadian Real Estate Association (CREA) reported there was just 1.8 months of inventory available nationwide. 

“Unless something drastically changes, I don’t believe we’re going to see a lot of supply in the market,” she said. “I think we’re still going to go down this path of lots of demand, not a lot of supply.”

What does the spring 2022 market look like for buyers?

Given the predicted ongoing housing supply shortages, the best strategy for prospective buyers is to be as prepared as possible. 

“The first thing you usually need to understand as a buyer is your own financial circumstance,” said Yao. “You have to talk to a mortgage broker, you have to know exactly the area you want to be in. You need to know your price range. You need to know the details of the property that really matter to you before actually going and looking.”

Once you’ve consulted with your mortgage broker and you’re ready to begin touring homes, Morrison and Yao both agree it’s essential to move on new properties quickly once they become available. 

For instance, Morrison says you’ll want to ensure your bank allows you to access deposit funds swiftly in the event of an offer. You’ll also want to view properties within the first day or two they’re listed on the market so you can get ahead of competing purchasers. 

“The more days that go by, the more time people have had the opportunity to see [the property], and if you’re the buyer, you don’t want other people to see it,” said Morrison.

What can sellers and investors expect for spring 2022?

Compared to buyers, sellers have the upper hand in the current market with more purchasers compared to listings. However, this doesn’t mean those putting their home on REALTOR.ca can slack off on any of the important setup steps. 

As homes are heavily viewed and marketed online like any product, Morrison explains professional photography, staging, and cleaning is crucial to getting your listing off on the right foot. It’s also beneficial to consider including a home inspection report for added transparency and knowledge.

Yao explains, thanks to the efficiency of technology and the current competitive market conditions, buyers will often narrow down their choice of homes online before making a showing request to visit them in person, hence the importance of a good online presence. 

“People are used to seeing a place before going into it. They want to understand things even more so now. Especially with the multiple offer situations,” said Yao. “You don’t really have the time to go around to 20 houses and then pick one and go for a second showing and so forth.”

For property investors looking for cash flow, Morrison expects the rental market will continue to strengthen into the new year as people return to downtown areas for work. 

If you are thinking of buying, selling or renting a home in spring 2022, consult the help of a local REALTOR® for expert advice and guidance on the market.

The market remains hot, but it’s still important to make sure your property appeals to buyers before listing. Check out a few easy steps you can take to help your home stand out and sell quickly.

If you’re thinking about listing your home in 2022, there’s no reason to wait until the spring, as low housing inventory and high demand continue in many parts of the country. Winter typically has been a slow time for real estate sales in most parts of the country, but as we kick off the new year, serious buyers likely will pick up where they left off in 2021, facing stiff competition for properties that are selling quickly and for high prices.

Despite the hot market, it’s still important to make sure your property appeals to buyers before listing. Here are a few easy steps you can take to make sure your home stands out.

Sort through holiday decorations. Make the dreaded annual ritual of taking down decorations more productive by using it to begin clearing out unwanted items as well. Before stuffing all your trimmings into plastic bins, take stock of everything you have – lights, ornaments, wreaths, figurines – then toss or donate those you no longer want.

Declutter and depersonalize. Decluttering is the key to making your house appear more spacious. Go through each room and decide which pieces of furniture and other things to keep, donate or put in storage, and remove family photos and personal knickknacks.

Boost curb appeal. You get only one chance to make a positive first impression. To make the exterior enticing, paint the front door, pressure-wash the driveway and patios, clean out gutters, trim shrubs and trees, and add greenery and fresh flowers to your entryway and front porch.

Deep clean. A spotless house will show buyers your property is well taken care of. Clean from top to bottom, including windows, window treatments, ceiling fans, baseboards, countertops, cabinets, flooring and appliances.

Repaint in neutral colors. A fresh coat of paint can make the interior feel new. To appeal to a broader audience, choose warm neutral colors, such as beige, tan, gold or gray.

These easy steps will make your property stand out, appeal to more buyers and sell quickly.

The COVID-19 pandemic has paved an unexpected path to homeownership for many young Canadians. Sure, mortgage rates fell to historically low rates, but a severe lack of supply and highly competitive sellers’ markets meant many Millennials and Gen Zers were left watching from the sidelines.

As restrictions loosened and life returned back to “normal”, demand for housing increased, pushing prices up in the process. As of November 2021, the average price for a home in Canada was $720,854, a 19.6% year-over-year increase according to data from the Canadian Real Estate Association (CREA).

So what exactly does homeownership currently look like for younger generations?

When it comes to where and how younger generations are choosing to live, it turns out they’re forced to be more practical. Austin D. Titus, real estate broker for Century 21® First Canadian Corp based in London, Ontario, explained while he hasn’t noticed “too much” change in terms of homeownership preferences, he has observed younger demographics are more flexible and understanding of what they can actually afford in current market conditions. 

“Often, first-time home buyers or younger generations are less likely to feel comfortable doing renovations and want more of a move-in ready option. I would also say younger generations don’t want much yard work or maintenance,” explained Titus, who added condo living can be an attractive lifestyle for this generation of buyers. 

Titus also said as a result of the pandemic, young buyers are looking for homes with additional office or outdoor spaces—a trend that wasn’t as popular before.

Regardless of age, getting into the housing market is a lengthy process requiring a lot of patience, time, and money. But understandably, it can be even more challenging for younger generations if they don’t have adequate savings to compete in today’s market. 

Titus says he thinks it’s extremely difficult for younger generations to get into the housing market because they’re dealing with much higher housing prices compared to two or three years ago. Wages aren’t increasing at the same rate as inflation and there are high expectations of first-time home buyers from parents. 

“Unfortunately, I also feel buyers are expecting their dream home as their first property,” explained Titus. “In our initial consultation, a lot of what is discussed is actually breaking down the barriers of expectations versus the reality of the market. Parents often put the expectations on their children of what is acceptable versus not in a home and it’s often my job to paint a very different picture.”

Want to hear about how different generations are rocking Canadian real estate? Austin joined a panel of REALTORS® for Episode 17 of CREA’s REAL TIME podcast to talk about trends and a redefined landscape.  

Current programs available to first-time home buyers and younger buyers

Purchasing a home can be both exciting and overwhelming. The Canadian government does have a number of financial programs in place to help Canadians during their home buying journey, including incentives for first-time buyers, tax credits, and rebates.

“There are options for the Registered Retirement Savings Plans (RRSP) program where buyers can take from their RRSP and use it as a portion of their down payment,” explained Titus. “This amount currently sits at $35,000, however you must repay it in a 15-year period.”

He also explained first-time home buyers who are permanent residents and Canadian citizens are able to use the land transfer tax rebate, which rebates up to $4,000 of the land transfer tax. 

“The $4,000 rebate caps at $368,000. Any amount over that, and you’re left paying the difference,” said Titus. 

There is also the First-Time Home Buyer Incentive, a shared-equity mortgage with the Government of Canada that offers 5% or 10% (depending on the type of home) of the home’s purchase price to put toward a down payment. There are stipulations, however, such as the borrower’s household income must be less than $120,000 a year ($150,000 if the home you are purchasing is in Toronto, Vancouver, or Victoria).

How parents are helping their kids

In today’s housing market, many younger buyers might find themselves struggling to afford a down payment and meet strict mortgage requirements. As a result, some assistance from parents has become increasingly common. Having the means to be able to help your children buy their first home is a luxury, ​but before you sign on the dotted line, consider the best way to do so. 

“Parents assisting their kids on the down payment wouldn’t have any tax implications for either party,” said Titus. “Co-signing on the mortgage where the parents would be equally responsible for the mortgage would have the largest impact when it comes to selling the property in the future.”

However, Titus says there are ways in which this can be avoided, and it’s best to have either a REALTOR®, accountant or lawyer advise you on the best route to take.

Parents assisting their children can also consider having a 1% ownership in the property, which would allow them to avoid taking high capital gains. But keep in mind, the first-time buyer incentive gets cut in half if there is a co-signer on the mortgage who already owns a property. 

If you’re a parent thinking of using the current RRSP program to help your child, parents aren’t eligible to do so. The current Home Buyers’ Plan (HBP) allows you to withdraw funds from your RRSPs to buy or build a qualifying home for yourself or for a related person with a disability. However, the Canadian Real Estate Association has been advocating for changes to the HBP since 2017, allowing for “intergenerational use of RRSP funds by one child or more for the purchase of a home.” The goal is to help close the gap for young Canadians when it comes to homeownership.

So if you’ve been thinking about entering Canada’s housing market, meeting with a REALTOR® can help you get the answers you need when it comes to programs available and options that would best suit your lifestyle and budget.

Since the onset of the COVID-19 pandemic, Canadians have been taking advantage of some of the lowest mortgage interest rates in history. 

On March 4, 2020, the Bank of Canada (BoC) made a 50 basis point cut to its mortgage-market influencing overnight rate as the global economy grappled with the arrival of COVID-19, the first cut since 2015. After two additional cuts, the overnight rate sank to 0.25% where it has remained since. 

Now, according to the most recent overnight rate announcement from the BoC on Wednesday, Dec. 8, the current rate is still expected to hold into mid-2022. Adding into the mix, Consumer Price Index (CPI) inflation is anticipated to remain elevated into the first half of 2022. 

Shaun Cathcart, Senior Economist and Director of Housing Data and Market Analysis at the Canadian Real Estate Association (CREA) sheds light on what inflation and interest rates could have in store for us in 2022.

What changes in interest rates and inflation can we expect this year?

As the Canadian economy continues to recover from the ripple effects of the pandemic, the BoC said in its latest announcement the economy requires “considerable monetary policy support.” For this reason, the bank has chosen to maintain the overnight rate until mid-2022 when the first increase is expected to occur. 

Cathcart explains the decision to raise the overnight rate in the second or third quarter of 2022 has been established for some time now, but is still contingent on future market data. Already, mortgage rates have been rising in recent months like they did in the spring. 

“The bigger question is how many rate hikes are they going to do, and how fast are they going to do them?” said Cathcart.

The BoC’s decision to hold the overnight rate has also been made so that “economic slack is absorbed” in order to meet a 2% inflation target in 2022. 

The CPI, an indicator of changes for consumer prices, rose 4.7% on an annual basis in October 2021, the largest gain since February 2003. Initially, the BoC expected CPI inflation would die down by the end of 2021, having been elevated around the 3% mark during the summer. However, the BoC revised its forecast in October, predicting these levels would stay high until the first half of 2022 before easing down to 2% in the second half of the year.

“CPI inflation is elevated and the impact of global supply constraints is feeding through to a broader range of goods prices,” according to the December BoC announcement. “The effects of these constraints on prices will likely take some time to work their way through, given existing supply backlogs.”

How could these changes affect mortgages and everyday living?

With the overnight rate anticipated to rise next year, Cathcart says it may prompt some mortgage holders to lock in their rate ahead of time. 

For new mortgage owners, they’re qualifying at almost 300 basis points above the rate they’re getting, he added. In that sense, the mortgage stress test may act as a “major cushion” against rising rates, but this will depend on how the government may choose to adjust it.

“Depending on how much they raise it, if at all, that could impact people’s qualifying for mortgages more than the actual rate they’re getting,” said Cathcart.

With interest rates having dropped so low over the last two years, some existing mortgage holders may have opted to lock in or renew their mortgage to take advantage of potential savings. Cathcart notes similar to how market activity can be fueled by lower rates, a hike to rates tends to cool things off. 

“That’s definitely going to be a headwind for activity and prices remaining at the level they’re at next year,” he said. “The stress test is actually going to act as a bit of a cushion maybe against that.”

If the BoC must raise rates to control inflation, Cathcart says this makes it more expensive to carry a mortgage. As the BoC is saying they’re expecting inflation to remain high into 2022, this tells Cathcart it could be above their target for next year. 

“If they want to be slow and steady raising interest rates with so much debt out there, it’s not going to take as many interest rate hikes to get the effect that they want as it did in the past. The economy is more sensitive to that,” said Cathcart. 

Thanks to more purchasing power and scarce supply of goods and services, economists from the Royal Bank of Canada (RBC) also predict inflation rates are “likely to remain above central banks’ targets throughout 2022.” 

The rise in inflation has been driven by factors like higher commodity prices, climbing business input costs and policy stimulus, which are expected to ease over time. During the most recent jump in the CPI, Statistics Canada reported price increases for all eight major CPI components, from transportation to shelter costs. The price of energy, meat products, and passenger vehicles recorded some of the most notable yearly increases, rising 25.5%, 9.9% and 6.1% in October respectively amid labour shortages and supply chain challenges. If inflation continues to climb in 2022, it may impact the cost of living for many.

For the most up-to-date insights on how rising interest rates could affect you, ask for the advice of an experienced REALTOR® or mortgage professional.

The information above is for informational purposes only and should not be used as investment or financial advice.

Following a rollercoaster of a housing market in 2020, this year appeared much more normal by comparison. However, the 2021 Canadian real estate market was still a far cry from what we would typically expect when it comes to buying and selling homes.

“In terms of housing market conditions, they’re less normal,” said Shaun Cathcart, Senior Economist and Director of Housing Data and Market Analyst at the Canadian Real Estate Association (CREA). “They’re further away from a Goldilocks normal market than they were in 2020. We still have not turned a corner on some of these extreme conditions.”

From available home supply to the COVID-19 pandemic, real estate in 2021 was defined by tight market conditions and shattered sales records, attributes that could set the tone for 2022.

Tight market conditions persisted in 2021

Cathcart explains we came into 2021 with the tightest demand-supply conditions ever in Canada by quite a margin. The spring market was characterized by strong sales growth, with record-breaking levels reported in January, February and March. During these months, the national average sale price also jumped 22.8%, 25%, and 31% year-over-year. 

Transactions slowed into the summer as sales fell 7.4% and 8.4% month-to-month in May and June.

Activity picked back up into late 2021 as prices and sales surged again. In October, the Canadian housing market recorded its highest count of sales in history with 581,275 residential properties sold year-to-date, a level that passed the annual record of 552,423 sales for all of 2020. At this time, there was just 1.9 months worth of inventory on a national basis.

However, Cathcart notes the ratio between new listings and sales didn’t change. The quantity of homes available on the market often determined what prospective home buyers were able to purchase, not whether they wanted to buy properties in the first place. 

“The number of sales going up and down like that is dictated by how many homes come on the market, because everything is still selling,” said Cathcart. 

“To see a 25% decline in sales and say ‘demand is going away,’ and maybe price growth did slow down a bit in the summer, but I think those sales numbers could have stayed just as high if people had been listing their homes for sale,” he added. 

Supply shortages driven by multiple generations and buyer types

More than one factor appeared to contribute to dwindling supply in 2021. 

For existing homeowners listing their property for sale, those sellers needed somewhere else to go, Cathcart explained. In some cases, sellers were “stuck” as the limited market options made available to them kept them in place. Compared to first-time buyers who are likely to consider any home in their desired market, move-up buyers tend to look for a specific property that’s better than what they own, a small subset of the current market. This created a cycle that prevented some homes from coming online.

In addition, some sellers may not want to immerse themselves into the competitive market that frequently sees bidding wars, Cathcart said. Adding into the mix, Boomers, Gen Xers, and Millennials are all in their homeownership years at the same time, squeezing what available supply there is. There’s also the pace of new homes being built in comparison to high demand to consider as well. 

“In absolute numbers, the tightest markets in the country are right up in cottage country and areas on the outskirts of the Greater Golden Horseshoe in Ontario,” said Cathcart. 

The pandemic still played a role in influencing sales

Although mass vaccination and fewer lockdowns have helped business operations mostly return to normal, the COVID-19 pandemic still played a role in influencing market trends and behaviours in 2021.  

The importance of home still rings true for many current and hopeful buyers in the market. Existing homeowners who may have outgrown the needs of their current property continued to generate movement and sales across the country.

Home buyers could upgrade their property to something more spacious and downgrade their mortgage in the process by moving to affordable areas outside of urban centres where remote working is possible and no commute is needed. Inter- and intra-provincial migration is high and is expected to continue into 2022, according to research from RE/MAX Canada. 

“Definitely the panic of having to secure a bunker to ride out the pandemic, that part is pretty much over,” said Cathcart. “I think the COVID-19-related changes to people’s lives will continue to result in a lot of people moving around in the years ahead.”

Falling sales, higher prices anticipated for 2022

Heading into the new year, some of the conditions that influenced changes in 2021 could still linger. 

In September, CREA predicted in a quarterly forecast that sales would fall 12.1% annually to around 577,000 units in 2022 thanks to “higher prices and a lack of available supply.” While this drop in sales would make 2022 the second-highest year for transactions, Cathcart explained the predicted national home price average of $718,000 would likely be readjusted to a higher amount as September and October saw prices accelerate year-over-year by 13.9% and 18.2%. 

“If history is a guide, it could be revised higher again before we start to see the impact of things like higher interest rates when we do start to see things fully levelling off,” he said. 

The quantity of listings will continue to determine sales based on what is available for homeowners to buy. The kind of year we could see will largely depend on what each of the players in the market decide what to do next, whether they opt to stay put or move farther afield. 

“It’s going to depend on to what extent people continue to move all around the country, which generates a lot of activity,” said Cathcart. “It’s also going to depend on how many options those people who want to move actually have to be able to move.”

To find out what’s happening in your local real estate market in 2022, consult the insights of a REALTOR® for information on pricing, inventory, and more.

Though the history of Slovenia as an independent country dates back only to 1991 after the dissolution of Yugoslavia, the settlement later known as Ljubljana first emerged as the Roman city Aemona near the current site of Ljubljana Castle, on the banks of the Ljubljanica River. A city of bridges, like Budapest and Prague, Ljubljana connected along a trade route between the Adriatic Sea and the plains of the Danube, from Vienna to Budapest.

The Ljubljana Dragon symbolizes the city, a beast of Slavic mythology representing water, fertility and bounty, along with courage and power. The dragon may connect with the Greek myths of Jason and the Argonauts, but it’s more likely due to the association with Saint George, patron of Ljubljana Castle’s chapel. The dragon, part of the city’s coat of arms for hundreds of years, became increasingly central as Ljubljana’s mascot through the 19th and 20th centuries.

Ljubljana castle

Dominating the Slovenian capital’s downtown skyline, Ljubljana Castle sits atop a hill in much the same way as Edinburgh castle oversees its city. The castle also provides the setting for the dragon on the coat of arms. 

Original construction of the castle likely dates back to the 11th century, but the castle’s current profile stems from a 15th century rebuild as a defence against Ottoman invasion and peasant uprisings. The irregular medieval fortress now serves as a cultural centre for the city, a beautiful and benevolent overseer of the Ljubljana basin.

Zmajski most (The Dragon Bridge)

A road bridge built in the Vienna Secession style in the early 20th century, the Dragon Bridge crosses the Ljubljanica slightly northeast of Ljubljana castle. Replacing an oak bridge damaged in an 1895 earthquake, the Dragon Bridge takes its name from four copper sheeted dragon sculptures that visually highlight the four corners, with an additional 16 smaller dragons sprinkled about.

Prešeren Square

The heart of the city beats strongest through Prešeren Square, a hub at the bend of the Ljubljanica northwest of the castle. It’s a prime spot for events, such as the city’s Dragon Carnival and other festivals. 

The square, a pedestrian zone since 2007, began to take its current form with the construction of the Baroque Franciscan Church of the Annunciation in the mid-1600s. The 1895 earthquake led to the clearing and revitalization of the square, with a monument to Slovene national poet France Prešeren added in 1905.

Slovenian Philharmonic Building

Though its predecessor, the Estate Theatre, succumbed to fire in 1897, the neo-Renaissance Slovenian Philharmonic Building survived the earthquake four years after its 1891 construction. It serves as home for the Slovenian Philharmonic Orchestra, one of the oldest in the world. Canadian Keri-Lynn Wilson served as the orchestra’s principal conductor between 2013 and 2015, the first woman to hold the role. 

Nebotičnik

Incorporating Art Deco and neoclassical design elements, the 13-storey Nebotičnik ruled as the tallest residential building in Europe for years after its 1933 completion. The design incorporated the skyscraper triad ideas of American architect Louis Sullivan: the base that interacts with the street and pedestrians, the central column comprising the bulk of the building, and a capping crown. Constructed from reinforced concrete, Nebotičnik (translated, “the skyscraper”) incorporated many new technologies including safety standards against seismic activity.

The modern history of Ljubljana is largely tied to two names: Maks Fabiani, personal advisor to Austro-Hungarian Prince Franz Ferdinand, and Jože Plečnik, an important native Slovenian architect. Their design visions overlay the deeper history of the city, shaped by time and circumstance into an architectural melange with more than a passing nod to Art Nouveau, the in-vogue style at the time of post-quake rebuilding. An elegant and green city, Ljubljana holds plenty of treasure for architectural sightseers.