The good news: Mortgage rates have never been lower.
The less good news for some:
“The new rules to qualify for mortgage insurance from Canada Mortgage and Housing Corp. (CMHC) are expected to cut the maximum purchase price for borrowers of insured mortgages by up to 12 per cent, more than offsetting the drop in mortgage rates for those who can’t come up with a 20-per-cent down payment.”
It’s a buyers market for.. well stocks and oil anyways.
Will plummeting interest rates make real estate more appealing or will a hit to the wider economy drive down house prices?
What’s your bet?
Sorry to tell you, but we’re not number 1 – that honor goes to New Zealand, but Canada is right up there on this visual map of countries at the greatest risk of a bursting housing bubble.
Thanks to southseacompany for the link, see all the data here.
Mortgage brokers make their money by getting people mortgages. In a softening market this can present a challenge.
FICOM is the agency that regulates mortgage brokers and they are issuing a warning:
Brokers should not overleverage their clients; this may be done by fudging applications – overstating the income of a borrower to obtain a bigger loan (and hence a bigger commission), said Carter, who also warned brokers of working with unregistered fixers.
Carter told brokers in Vancouver that the days of “how to get to yes” are over with new market uncertainty, and slumping sales and prices. Now, brokers need to be extra vigilant and learn “when to say no.”
He said Canadians could be in for a rude awakening if real estate prices fall and they’re still saddled with big mortgages and even loans against their equity, suggested Carter. And the brokers who brought loans to those homebuyers will face extra scrutiny, he said, which is why he’s calling on the industry to ease back the throttle on new mortgages that may be contrary to the best interests of the public.
Read the full article here.
Ever felt like telling the future?
What do you foresee happening to the local economy an housing market in 2019? Where will interest rates go?
The Bank of Canada seems to think we’re not in for hot growth and are keeping rates flat for the moment.
A couple of brokerages predict prices will stay flat or decline only slightly in 2019.
The general consensus and safe bet is to predict a status quo situation. No major drops or increases in the market. That sound about right?