Are you thinking of buying property in the GTA but afraid to make a decision? Are you worried that prices will go down after you buy or that interest rates will go up? Here are four reasons why you should buy now!
- The mortgage rules will change on January 1, 2018. Actually the Government of Canada is making a few changes but the one that will affect buyers the most is the one commonly called the stress test. Right now, if you are applying for a mortgage and your downpayment is less than 20% then the mortgage company or bank has to qualify you as if you were borrowing money at a higher percentage interest rate than what you will actually be paying. This is to ensure that you will be able to continue paying the mortgage when interest rates go up. After January 1st all borrowers will have to pass this stress test, regardless of the amount of your downpayment.
- In April of 2017 the Premier of Ontario introduced 16 measures to cool down the real estate market in Ontario. The measures had the desired effect and average house prices fell in the GTA. However the prices have now stabilized and have even started to rise in some areas. In particular, condos that are in the downtown core or that are close to subway stations are in greater demand than before. I do not see house prices going any lower and they are likely to start to go up again for reason 3 …
- The fundamentals of the real estate market have not really changed. The population of the GTA continues to grow and will be at 8 million by 2026. Housing supply continues to be limited and there are not enough rental properties to make up the gap. New housing is not being built fast enough while migration to our great city continues from other provinces and other countries. Also interest rates are likely to remain low for at least the next 18 months or so. I predict that 5 years from now we will be looking back at today’s prices and consider them low. To put it another way, I predict that house prices will continue to rise dramatically over the next 5 to 10 years.
- Many buyers are still waiting to see what’s going to happen next. Less buyers in the market mean almost no ‘bidding wars’ and multiple offers. You are also likely to get the first house that you ‘fall in love’ with.
If you are ready to take advantage of this market and buy a home, whether for investment purposes or to live in, I can help. Call me, send me a note at firstname.lastname@example.org or complete the form below. Remember that, when I help you to buy a home, my commissions are paid by the Seller. I’ll be happy to help you to qualify for a mortgage and to buy your property – before the prices rise again or one of the governments change the rules again.