Most people agree that there’s a problem with the BC real estate market, and that problem is usually called ‘affordability’.
Affordability usually means what you’re buying is too expensive, but it can also mean that you just can’t afford the monthly payment.
Interest rates look at risk of rising, but have been at rock bottom levels for years. That means there’s not much room to move on ‘affordability’ when it comes to interest rates.
So we’re stuck with two options: price comes down or government starts giving away money.
Daily Hive says they know what this announcement will be.
Update: They were correct, here are some details:
The B.C. Home Owner Mortgage and Equity Partnership program will provide a maximum of $37,500 — or up to 5 per cent of the purchase price — with a 25-year loan that is interest-free and payment-free for the first five years.
“The dream of home ownership must remain in the grasp of the middle class here in British Columbia,” said Premier Christy Clark.
The intention of the program is to assist people who can afford the mortgage payments on a new home but are challenged to make the down payment.
The province will start accepting applications for the program on Jan. 16, 2017.
Homebuyers will pay no monthly interest or principal payments over the first five years as long as the home remains their principal residence.
After the first five years, homebuyers begin making monthly payments at current interest rates.
If too much debt got us into this problem, surely it can get us out of it right?
Meanwhile the Bank of Canada is warning again about huge mortgages and growing household debt.