In this article on the Globe and Mail today, they talk compare sales from this past June with the June of 2009, and that sales are down about 30% from last June. They correctly attribute the slower market (in my opinion) to the mortgage lending rule changes that were made in April. The market saw an increase in sales prior to the mortgage changes, and has seen a decrease in sales since the changes have been made.
The interesting part in the article is that This is the second busiest June in the history of the Vancouver real estate market. The summer tends to be a bit slower for sales in general due to many people being on vacation.
The representative of the Real Estate Board of Greater Vancouver has stated that demand for housing is still quite healthy.
How Does This Affect Me and My Mortgage?
This is the paradox of the psychology of homebuyers…when the market is going very well and is busy, everyone wants to BUY a home. When the market is slow, NO ONE wants to buy a home. However, when everyone wants to buy a home, no one can get one for the price that they can afford, or are willing to pay, or have had a pre-approved mortgage arranged for them. When the market is slow, there is a lot more properties out there that do not have buyers, and it is often possible to
- Get a home that you would really enjoy living in. This is first and foremost for most people who primarily buy a home to live in.
- Get a better rate on your mortgage. When housing sales are down, it can often be a sign of a slower economy and the mortgage market adjusts by lending money at cheaper rates to encourage borrowing.
- You can borrow more money. This ties into lower payments on your mortgage due to lower rates, and then allows you to get a better property like in point 1.
In the stock market, the general idea is to “buy low, sell high”. Except in real estate, it generally goes up, and up, and up in value. Therefore, it is never really a good time to wait if you can afford to buy. However, when you hear that the market is slower…that is an even better time to buy.
Currently, mortgage rates are still near historically low levels. They have decreased again significantly in the past 3 weeks. There are people out there who want to sell their homes, and are having a more difficult time finding a buyer. Contact me, I will get you a mortgage pre-approval and you can take advantage of these low mortgage rates and have an easier time finding the ideal home you are looking for! Fill out the form below, and I will respond quickly for you.