Fall Housing Market

The Fall Housing Market

Canadian Fall Housing Market 

The Canadian Fall housing market prices are expected to have a five per cent increase in what’s remaining of 2021. It was reported that 26 out of 29 of Canada’s major housing markets, were sellers markets. 

There was also a high demand and a low inventory, which is what added to many bidding wars. “Early indicators from RE/MAX brokers and agents across Canada’s housing markets suggest steady activity for the remainder of 2021.” 

When it came to single-detached homes, we experienced the bigger price increases compared to the same time last year. These increases were between 6.8 per cent and 27.3 per cent across all 29 markets. According to RE/MAX, they expect this trend to remain among young families and for it to continue into the fall. 

“As our brokers and agents predict, the fall market activity is expected to remain steady, which is promising, despite the ongoing challenges presented by the Delta variant. This is particularly relevant given housing markets in Canada are often a good indicator of economic activity in the country, and with the Bank of Canada forecasting economic growth of 4.5 per cent in 2022, a strong fall housing market is a good sign that things may be starting to return to a more natural rhythm.” – Christopher Alexander, Senior Vice President, RE/MAX Canada.

Housing Overview for Ontario 

When it comes to the housing market in Ontario, we saw the highest average residential price increases for single-detached homes. It was reported that the majority of the other regions had increases. They were between 20 per cent and 35.5 per cent year-over-year. 

However, the outlier markets experienced prices below 20 per cent. This included Toronto, Thunder Bay and Mississauga. Condos and townhouses performed quite well in all of those regions. Smaller and more suburban markets such as Kitchener, North Bay, London, Peterborough, and Southern Georgian Bay had a higher surge.

“The estimated price outlook for the remainder of the year ranges from a two-per-cent price decrease in North Bay, to increases across the other regions ranging between two and 15 per cent.”

The REALTORs Association of Hamilton-Burlington September Stats 

According to the REALTORs Association of Hamilton-Burlington (RAHB), there were a total of 1,226 residential sales. It was also reported that the average residential sale price was $881,656. This is a almost a five per cent increase from August 2021, and 22 per cent increase from September 2020.

RAHB also reported that in September 2021, there were 279 new listings in Burlington and that the average residential property price was $1,064,685. These are both increases when compared to the same time last year. 

“After months of relatively flat prices, September’s historically low listing and inventory levels have moved the average sale price to a new record. The demand remains strong and the supply remains low. Overall, we need more supply on the market to meet the demands of buyers and investors. There’s nothing on the horizon to indicate that October will be any different.” – RAHB President Donna Bacher.

Contacting Lori VanDinther and Team 

If you have any questions or concerns my team and I are here to answer them for you. We love connecting with our clients, this is because our goal is to help you find the home of your dreams. Please feel free to contact me anytime either by email or phone and I’ll do my best to help you! Myself and my team look forward to working with you! 

Canadian Real Estate Market

The Canadian Real Estate Market 

Canadian Real Estate Market 

In a recent report by the Canadian Real Estate Association (CREA), the Canadian housing market may have reached it peak. While some markets are still experiencing record breaking gains, “these broad-based trends are spotlighting some crucial developments.”

This is some good news, since that means things could be returning to some what of a normal market. The question now is, will this help some Canadians get into the housing market or move up in the market. This is something that we’ll need to watch over the next few months to know for sure. 

“Whether you are of the opinion that the boiling Canadian real estate market has been reduced to a simmer, or that it is poised for a steep correction, it’s always prudent to analyze the numbers. In this case, the late summer figures that are emerging may suggest one thing: the peak happened months ago.”

Has the Canadian Real Estate Market Peaked?

This is the question we’re all asking ourselves right now, this is because the housing market has been very hot for quite some time. According to CREA, sales of residential properties had a 3-5 per cent decrease month-over-month since July. That decrease is the smallest monthly decline since March. However, since March housing transactions have decreased 28 per cent and 15-2 per cent on an annualized basis, in terms of unit sales on an annualized basis. What does this data mean and what does it highlight? 

“The data highlighted that the slowdown in the national real estate market was less broad-based as the drop in sales was concentrated in two-thirds of local markets, led by Calgary and Edmonton. Sales also moderated in places such as Montreal. But it should be noted that July 2021 sales were still the second-best month of July on record.”

When it comes to supply, it has continued to be an issue in the Canadian real estate market. This is because the number of new listings for residential properties had an 8.8 per cent decrease month-over-month in July. The largest decreases were in Vancouver, Calgary, Montreal and the Greater Toronto Area. This indicated that it has been a sellers market, “since it suggests the number of months it would take to exhaust demand at the present rate of sales activity.” 

The Canadian Real Estate Association also reported that, “housing starts totalled 286,620 units in July, down from 293,085 units in June. Single-detached urban starts jumped by 7.1 per cent, but multiple urban starts tumbled by 3.1 per cent. Rural starts were relatively flat at a little more than 23,000 units.”

Real Estate Cool Down 

Is this indicated the real estate market is finally cooling down? According to an op-ed in the National Post, sated that sellers are in fact turning down offers in hopes that they’ll receive a better offer. 

“Indeed, after seeing meteoric gains in recent months, many homeowners might believe they can wait until they receive a better offer. However, that higher bid may not come as many homebuyers have done one of three things: exited the market due to soaring costs, suffered buyer fatigue, or chose to wait until a correction intensifies.” 

It’s also been reported that some of these sellers are choosing to listen to their family and friends, rather than the data. This is according to some industry experts who also say that this is being done even though there is a lot of data out there. 

“While it is true that the Canadian real estate market remains robust as prices approach an average of $700,000, growth has ostensibly reached its zenith, at least for now. On the one hand, the price growth may have erected a multi-year barrier for young families and first-time homebuyers. But, on the other hand, at least many Canadians know what to expect as the housing market could eventually return to pre-pandemic conditions, especially in areas that have historically been more affordable.”

So what now, what happens next? It was reported that the Bank of Canada may rise the interest rates next year, making the real estate market is vulnerable to a rate hike. The next 12 to 18 months will be interesting for real estate agents and their clients as we watch the market. 

Contacting Lori and Team 

It’s exciting when you’re taking the step to look for your new home and I want to make sure that you have a wonderful experience. Myself and my team work hard to make sure that our clients are happy and in love with their new home. 

You can contact me either by phone to email and I will be happy to answer any questions about how mortgages work, and any others you might have. If you’ve been wondering what your home is worth, you can use my What’s My Home Worth calculator. I’m looking forward to working with you soon! 

How Mortgages Work

How Mortgages Work

Mortgages and the Down payment 

Have you been wondering how mortgages work? When it comes to buying a home we all have to think about how we’ll finance it. It’s a major purchase and one that is life changing, you’re becoming a homeowner, it’s exciting. First we should review how mortgages work. 

There’s a lot that goes in to purchasing a home, you need to do a mortgage stress test. This test will determine what sort of mortgage you qualify for, we’ll discuss more of that later. We want to make sure that you also understand the two different types of mortgages as well, open and closed. We’ll start by discussing the down payment. 

The Down payment 

The down payment is just one part of the whole sale process, it’s a way of letting the mortgage lenders know that you, the buyer, are able to handle the financial sound. It also let’s the lender know that you’re able to make the monthly payments. It’s important for you to start saving for the downpayment well in advance of making an offer on a home. 

When it comes to the first step that you’ll take in this process, after saving, will be to find a mortgage lender. What is a mortgage lender? They’re a bank or an organization that is willing to lend you the money you need to purchase your new home. 

In Canada, there are a few lenders to choose from, for example, The Royal Bank of Canada, Scotia Bank, etc. In order to be able to get a loan you need to be eligible, this is determined by completing the pre-approval process. In this stage it’ll involve the mortgage stress test. We actually covered this in a previous blog. We’ll do a quick review of that here. 

The Mortgage Stress Test  

What is the mortgage stress test? To get more details please also check out a previous blog. To answer this question, in short, the stress test is designed to determine and see whether you qualify for a mortgage. Most lenders will require you to supply government ID, proof of address, employment information, employment history, credit history, credit score, and that you have an account with a Canadian bank. 

The stress test will allow the lender to determine a budget and how much you’ll be able to afford. Which is very important when it comes to what price range you can look at when house hunting. It’s also important to know so that you can budget for each month, making sure that you can make your mortgage payments, along with other payments that go in to having a home. There are two types of mortgages and this test will also help determine which one might be best for you. 

What are Open and Closed Mortgages?

Did you know that there are two types of mortgages? In Canada, when it comes to how mortgages work, all mortgages are either open or closed. Each one has different terms, and these terms will determine what’s allowed and what’s not. The terms also decide how often payments can be made and how much can be paid off. You can prepare choosing what type of mortgage you want, you’ll need to review you finical situation to do this. 

Closed mortgages have lower interest rates, however, they have more payment penalties. The penalties will be outlined in the montage details and will state how much money can be paid for each payment. You can lowed the monthly payment in exchange for a longer amortization period. 

Open mortgages have payment privileges at a higher interest rate. In this case your monthly payments don’t have a limit to what the specific amount can be. You can make lump sum payments if you choose. With an open montage you’re able to pay it off faster in many cases. 

When you’re deciding what mortgage is best for you, you’ll need to ask yourself a few questions. Some of the questions you might want to ask yourself are; what is your financial situation, can you pay your mortgage off early, when do you plan on selling, do you plan on selling before the mortgage term is up, what mortgage rate will you be able to afford. These are just a few important questions you need to try and answer. The next step will be actually applying for a mortgage. 

Applying for a Mortgage 

Now you’re ready to apply for a mortgage loan, but how do you do that? When applying for a mortgage it can be pretty straight forward, and the current market is flexible. Because the market is flexible it means that it’s easier for homeowners, and new homeowners, to get a loan that will suit their needs. You’ll apply for your mortgage through the financial institution of your choice, we listed a few above. They’ll walk you through the process in greater detail.

If you want lower rates and more freedom with loans, you’ll need to compete the qualifying criteria and also prove that you are able to make the monthly payments, the stress test will help determine this. Then when you’re ready you can begin to look for the house of your dreams, this is the really fun part. I can’t want to help you along in this journey. 

Contact Lori VanDinther and Team 

Taking the step to look for your new home can be a big one for some, and I want to make sure that you have a wonderful experience. Myself and my team work hard to make sure that our clients are happy and in love with their new home. 

You can contact me either by phone to email and I will be happy to answer any questions about how mortgages work, and any others you might have. If you’ve been wondering what your home is worth, you can use my What’s My Home Worth calculator. I’m looking forward to working with you soon!