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The butterfly effect in laypersons terms is essentially that small causes can have large effects. For a better description go here https://en.wikipedia.org/wiki/Butterfly_effect Lol. Now on to the point of this post. In Terms of this topic the butterfly effect on real estate might be viewed as what the Ontario government did to try and cool the housing market back in April with it's 16 point plan. Now at first glance one could argue that a 16 point plan is hardly the equivalent of a "small cause" but hear me out. The small cause was actually before the announcement....It was something not noticed like a 10% increase in immigration or the denial of a large swath of land slated for developement 15 years ago. It could even have been something as simple as person fibbing on their income statement to obtain a mortgage in 2014. You see the large effect could be the 16 point plan and the resulting fallout both good and bad. Therefore the  "butterfly",  we all may never know. Sooo lets chat about the large effects then shall we lol. First we have sales falling off in larger urban centres as buyers wait to see what effects (see what I did there :) these changes have on the broader market. This in turn will likely have a ripple effect ( I know lol, too much) on the surrounding communities. However is this a slowing of the market and a changing of the landscape? Well, maybe or maybe not. You see one large effect the April 20th announcement had was to spur sellers sitting on the sidelines to jump in and sell while the market was still good. As an example, the city of Guelph had 97 active listings on or around that date and within 30 days the listing inventory had jumped to well over 230. At no time in the previous 4 months had that city had over 118 active listings and now currently it has 280 on any given day or a 300% increase in homes for sale in less then 90 days. That...is an effect! So in theory the dynamics have changed and the world (real estate wise) is all good for everyone just as the government intended....or is it? Well pricing while it seems to have stabilized hasn't come down which was the hope of the government. You see most people who have put their homes on the market seem to be holding out for their price and if they don't get it then say la vie. In other words they simply are not selling for less, they just take it off the market. Not exactly the plan when hoping for more affordable homes to buy. Also sales are still quite good albeit not record breaking but still at levels higher then everything but record breaking. So that isn't helping with the affordability part the government was hoping for either. There is more choice now which is great for buyers...and Realtors for that matter lol but things are not really any less expensive. In the end we will have to wait longer to see if the final effect is larger then it currently is as this is always a long game. However in the short term prices are stable...and still much higher then 12 months ago and sales are good. Lets revisit this in another 60 days and see if the butterfly has caused a tidal wave. In the meantime enjoy the day like it may be your last and treat others as you wish to be treated....assuming you like being treated nicely that is :)  

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