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A very positive look at the Canadian property market was written in a current article from Scotia Capital. They are curious: Why is the Canadian real estate area head and shoulders higher other global real estate markets? Does this mean that Canadian housing is on rising or the rest of the world is on the way down?

The housing market in Canada is being aided by a few factors. Although there was a big jump in listings at the beginning of the year, these went very promptly. It goes hand in hand with the stock of unabsorbed newly constructed houses, which fell mainly due to the certain reductions in developers’ margins. Foreclosure is now lower than ever so there is little stock of these seized houses. In the US market the seized houses are the biggest issue.

Experts believe that the inducements given over the last year are what have encouraged the Canadian housing market, though the widespread good health of the market is in dispute. Unlike USA, where the tax encouragement package is time restrained and has mainly a short term effect, Canadian packages generally don’t have an expiry time.

There are numerous local and countrywide tax incentives and rebates on offer to Canadians. From first time home owners, property renovator’s those who want a more energy efficient property there is an incentive for all. Together with an dynamic attitude from Bank of Canada this makes our real estate stimulus package one of the strongest in the world (especially in comparison to the quite good market situation even before the application of stimulus).

This goes to demonstrate the bullish or upward flow of the housing market. Even though the stage looks fine, as with anything there is always some things to avoid. Scotia Capital experts are troubled especially about the Canadian condo category. Newly built condominiums are not selling very well and heading to a stockpile of unabsorbed new builds. Some experts are not very comfortable with CMHC estimated stats for unabsorbed condos and believe there may be rising pressure for a price drop in the condo sector.

Real estate investors should continue to regard the Canadian housing market as a brilliant investment. But it is imperative to watch the indicators closely, especially in the condominium sector. Whether the housing market continues in an upward trend or starts declining depends on the federal government. The results of all these housing incentives are not going to go on unendingly. A large jump in listings at a later date could be caused if the government try to funnel demands into the here and now without spreading it out over time. Withdrawing the policies smoothly over a period of time will mean a smooth transition without a destructive effect.