This year’s spring is likely to be unusually mild (according to Environment Canada)
Generally, spring is the perfect stage for a vibrant real estate market, so there is definitely going to be a lot of activity. If you have finally decided to join the league of homeowners, perhaps this is a perfect time.
Reports that prices are increasing in some regions add to the confusion about whether this is a good time to buy. The Global Property Guide indicates that prices have continued to rise in Canada’s major cities. Below are some things you should consider before you decide to buy a home in Canada this spring.
- Attractive But Unpredictable Mortgage Rates
It is very easy for new homebuyers to own homes, especially outside the big markets of Montreal, Vancouver, and Toronto. This is because mortgage rates have been stable for some time now. So you could take advantage of the best mortgage rates in the market.
What we cannot deny is that there is a general level of unpredictability of rates when it comes to home buying in Canada. Remember that the country is grappling with the effects of oil prices, a situation that makes the economy turbulent.
- Larger Down Payment and Competition
Since February 15, all mortgages of $500,000-$1 million for government-insured homes will attract a larger down payment (10%). With a maximum amortization period of only 25 years for these mortgages, homebuyers will obviously have to pay more per month. We have the best Mortgage Calculators to help you calculate these numbers.
If you are intending to buy a condominium or another affordable house in Toronto or Vancouver (the regulation is obviously targeted at these rampant markets), brace yourself for more competition as first-time homebuyers rush to buy homes.
- Price Variation According To Region
When CREA released its latest report, prospective homebuyers must have gasped in disbelief, “will I ever become a homeowner at this rate?” However, if there is one thing the report has reminded us, it is that real estate market is not national but local.
Generally, house prices in Canada are on the increase, especially in the big cities. However, you will note that these prices have great disparities when you put all the regions in focus. For example, while the west coast is very expensive, Prince Edward Island and Manitoba have remained very affordable. Perhaps it is due to the differences in weather that you will see house prices falling in Alberta and increasing in British Columbia at the same time.
Actually, if you remove Ontario from the equation, the average sale price has decreased by 0.3% as at January 2016. This is according to figures released by the Canadian Real Estate Association.
Of course, not every homebuyer sees this as an opportunity because the value of the home may decline even further. Nevertheless, if you look at the long term, this might be a perfect time to buy a home in most places. Check the best mortgage rates Canada has to offer.
Overall we expect to see heightened activity in the market thanks to the beautiful weather. Those prospective sellers who were delayed by winter might soon come out and put their houses up for sale. Spring is also the time many buyers throng the market and ready to take advantage of more listings to choose from. Looking at all these realities, it is clear that any prospective homebuyer has a lot of homework to do this spring.