Mortgage Market in Guelph

As the greater Toronto area sees significant growth in almost every economic indicator, The City of Guelph is seeing its own positive changes. Here we will take a look at the current state of the Guelph housing market, and how Mortgage Brokers in Guelph are reflecting on the positive changes going forward.

Low unemployment

Guelph has developed as the cleaner environment and low crime alternative to urban Toronto. The already low unemployment rate of 4.2 per cent is stabilized by increasing opportunities in research, biotechnology, and life sciences.

Keeping Guelph’s statistics distinct from nearby Kitchener and Waterloo, the City of Guelph reports a population of 121,688 heading for 161,000 plus by 2031. With 37,939 jobs in the professions, Guelph boasts an educated and diversified middle-class. Ethnic communities of Far-East Asians and subcontinent Asians, many with a long heritage as Canadians, make up about 16 per cent of the population. But, Guelph has not seen the volume in international immigration that has recently increased in other sections of the Holden Horseshoe.

Finding balance

Reporting for the construction industry, Market Wired reports, “Housing starts in the Guelph Census Metropolitan Area (CMA) were trending higher at 1,471 units in June compared to 1,234 units in May.”

In real market terms for Guelph, CMHC reports 82 to 159 starts of multi-unit construction and only 40 to 42 starts in single detached homes in the first quarter of 2016. Year-to-date, the 7 per cent increase in single home permits has done little to increase the housing inventory in this population dense town. In fact, the slow but steady increase in multiple units suggests an alignment with the Toronto market.

Such conditions will drive market prices up, and an expected increase in interest rates (from 4.4 to 5.0 per cent and later from 4.7 to 5.3 per cent) should strengthen the seller’s market. The CMHC outlook on housing starts does little to alter that market even if adjusted for the increase in townhomes and semi-detached units.

Increase sales

Nonetheless, sales of all property types have been rising recently; “home sales numbered 367 units in June 2016. This was up 11.6 per cent from June 2015, and was tied with April 2016 for the highest monthly sales figure on record. Sales of all types of properties in the Guelph region numbered 387 units in June, up 12.5 per cent from a year earlier.” And, the average cost was up 15.6 per cent at a record $428,548.

Allowing for the fact that university students represent a large portion of the population, their rentals keep vacancies down and prices leveled. This, in turn, contributes to the continuation new starts in multi-unit properties and continuation of the seller’s market.

In short, Guelph is not really feeling some of the market pressures affecting other locations in the province. Still, the mortgage market in Guelph increases the value of professional advice from the mortgage brokers serving the city. Whether customers are looking to buy, sell, or refinance, the market presents opportunities that brokers are happy to help them realize.