March 2018 - Real Estate Update

Spring Is Here!

The new mortgage rules have now been in place for only a few months and it’s already impacted housing across the country.  Canada’s national average home price was down 5 percent and sales volume was down 17 percent in February from a year earlier.  There was also near a 7 percent decline in the amount of transactions between January and February this year.  This is the second month-over-month decline and the lowest reading in nearly five years. 

The number of sales in BC has also plummeted since new federal mortgage rules took effect at the beginning of the year, however; it did not stop prices from rising.  Average prices were up almost 9 percent in February from a year earlier.  Sales of condominiums were impacted far less. The average price of a condo in Greater Vancouver rose over 27 percent from February last year.  It may only be a matter of time before the prices of condos moderates but don’t hold your breath as the average prices rose almost 3 percent from the beginning of the year.

Mortgage Rate Updates

Mortgage rates have remained primarily stable over the past few months and the Bank of Canada meets again to set the rate on April 18th.   I’m predicting the bank will not make any change to the rate.  In fact we may see some downward pressure on mortgage rates.  The uncertainty of trade relations, the impact of the new mortgage rules and the introduction of new housing policies have taken the steam out of rising rates.  That being said, the US Fed raised rates on Wednesday and signals that more hikes are coming this year. 

Qualifying today for a prime rate mortgage from a bank has never been harder but some of our lenders have relaxed lending criteria which can really make a difference in getting that approval.  If your bank said ‘no’, then give me a click: tony@tonyiannetti.ca

It’s of no surprise, but the demand for private money has increased significantly over the past year.  Rates for 2nd mortgages can be as low as 8.45% with only an appraisal being required.  Taking a 2nd mortgage may be the ideal solution to access equity because it will allow you to preserve and keep the existing 1st mortgage in place.   Have a question or need a rate quote: click here: tony@tonyiannetti.ca

Some best rates to mention:

• 5 year fixed – insured: 3.34%
• 5 year variable – insured: 2.50% (Prime - .95%)
• 5 year fixed – conventional: 3.59%
• 5 year variable – conventional: 2.90% (Prime -.55%)

February 2018 - Real Estate Update

It’s all about condos

There’s no lack of news on our local real estate markets and as much as there is some softness in certain market places, it’s the condo market that remains ‘on fire’. Buyers looking to purchase a modest priced condo are challenged with competing in multiple cash offers. This is not new news to any of us living in lower mainland but it’s a trend that seems to defy gravity. 

Some noteworthy stats to mention:

• Downtown condo prices are up 40% since January 2017.
• Port Coquitlam condo prices are up 25% since January 2017
• South Surrey/White Rock detached home prices are DOWN 13% since January 2017
• Cloverdale detached home prices are up 25% since January 2017

The rate environment is changing

Most borrowers are now aware of the changes in the mortgage world. Our government once again introduced new rules designed to make it harder to qualify for bank type mortgages.  On top of this fixed mortgage rates have increased along with a recent increase in the bank rate.  Many clients now require financing solutions outside of a qualified bank mortgage. I have plenty of private lenders looking to lend and help you get the money you need regardless of the reason. 

Best qualified rates:

• 5 year fixed: 3.25%*
• 5 year variable:  2.50%*

Certain conditions apply.

September 2017 - Real Estate Update

Prepare for more tightening
 

The Government is expecting to once again tighten mortgage lending rules with one of the biggest changes yet.  The Office of the Superintendent of Financial Institutions plans to mandate that banks will have to qualify borrowers using a new stress test.  Borrowers will have to qualify based on a rate two hundred basis points higher than their contracted rate.  A similar change occurred last year but it only applied to ‘insured mortgages’ and it negatively affected millions of people.   On top of this, fixed and variable mortgage rates have increased.   It will likely be very difficult for many borrowers to access prime rates and/or borrow money in the near future.   I cannot stress enough how important it is for customers to review their debt position and act now to refinance or purchase before it’s too late.  Even if you don’t need money, then consider setting up a line of credit for when you do need money. 

Current rates:

-        Best 5 year fixed 3.24% (non-insured)
-        Best 5 year fixed 3.24% (insured)
-        Best Variable rate at 2.60%
-        Best Line of Credit rate at 3.50%       

Need a rate hold of up to 120 days? Click here.

Featured Property

Coquitlam Condo located near Douglas College, skytrain and Coquitlam center.

More Information

June 2017 - Real Estate Update

Mortgage rates ease - June 2017

Mortgage rates have moved slightly lower since my last update. Bank of Canada kept their official interest rate on hold at their last meeting on May 24 citing caution about making any changes to the rate. Economic conditions remain stable but there is elevated concerns about the housing markets especially those of Toronto and Vancouver. Any major deterioration in these markets could be a potential drain of the Nation’s economy. 

At the risk of sounding like a broken record; mortgage clients should be cautious when making decisions about rates. Variable rate mortgages remain the most attractive; however an unforeseen increase to interest rates could increase borrowers’ monthly payments significantly. 

Mortgage lending qualifications are currently very challenging but financing alternatives are available:

-        Income reasonability lending: First mortgage as low as 3.69%
-        Stated Income lending:  First mortgages as low as 5.35%.
-        Equity based lending:  Second mortgages as low as 7.95%
-        Construction and commercial financing of up to 75% LTV

 

Best Mortgage Rates:

-        Best 5 year fixed at 2.44%
-        Best Variable rate at 2.05%
-        Best Line of Credit rate at 3.20%

Need a rate hold of up to 120 days,  click here.

Featured property:   

Condo located in the River District Community. Fully renovated two bedroom condo for sale for $558,800.  Hyperlink:  http://tours.bcfloorplans.com/781449

March 2017 - Real Estate Update

No major changes to mortgage rates – for now. 

Mortgage rates have not changed much since my last update. The Bank of Canada kept their official interest rate on hold at their last meeting earlier this month but it was the opposite a few weeks ago in the US where the Feds increased rates. Rising inflation announced recently in the UK could set the stage for them to do the same. It’s not predicted, but Canada could potentially follow the same pattern especially if we continue to experience positive growth in jobs, retail sales and GDP.  An increase in mortgage rates would have a significant impact on housing affordability in Canada especially in the Vancouver and Toronto areas.

Mortgage lending qualifications remain very tight and getting access to cheap money continues to get more challenging. Lenders remain concerned with our real estate prices and many bank executives have expressed concern about a possible real estate bubble. Rising Canadian interest rates would intensify their concerns. 

Mortgage clients should be cautious when making decisions about rates and a fixed rate should be on their radar. Lenders have introduced many rate specials since beginning the Spring market especially for insured mortgage:

• 5 year fixed at 2.59%
• 4.5 year variable at 2.05%

Need a rate hold of up to 120 days,  click here.

Real estate sales have become closer to the averages but have begun to accelerate.

The BC Government continues to tweak real estate policies and recently announced positive changes to the foreign buyer’s tax. Ontario is hinting at changing the Capital Gains tax on real estate sales to deter speculators from flipping. Fingers crossed we don’t see any similar changes in BC. Vancouver and Toronto Real estate continues to be a hot topic and all eyes seem to be on the market conditions as we roll into the spring season. Local condo and townhome sales remain very robust and prices are rising fast. Detached homes are less so but prices are stable.  Stay tuned for further updates as we get further into the year. 

I have more new listings being launched soon. The latest:  Click Here to View Listings