Canadians are Ready to Join the Home Buyer Bandwagon

The Canadian housing market is already seeing the impact of falling interest rates, with close to half of Canadians saying that they are planning on buying a home in the next five years and more than 15% saying that cheaper mortgage rates will allow them to buy a home sooner than expected. Younger Canadians, who are struggling with far more debt than their parents did at the same age, are the most likely to respond to falling interest rates. In a recent survey, more than a fifth of homebuyers surveyed said that they have shortened the time frame for buying a home because of low interest rates and 75% said they are planning on making a purchase in the next five years.

Regionally, the demand among buyers is strongest in Ontario and Atlantic Canada, where the combination of low interest rates and cheaper oil prices are poised to put money in the pockets of consumers. Nearly a fifth of residents said that they said they would speed up their home purchase because of low interest rates. Mortgage rates have been falling for a significant period of time, the Bank of Canada shocked markets by cutting interest rates by 25%. Lenders have followed this with major banks dropping five year fixed rates mortgages to as low as 2.84% and cut their prime rates by 15 basis points, which pushed variable rate mortgages to as low as 2.25%.

Several analysts have predicted that interest rates will rise throughout the year; so many banks have made the decision to reduce interest rates. This is expected to reignite Canada’s cooling housing market. With the negative impact of lower oil prices on the Canadian housing market, interest rates are likely to remain low for some time. But with mortgage rates falling only slightly and more Canadians saying that they were planning on using lower rates to pay down their debt rather than load up on new ones, cheaper rates are expected to have a modest impact on the housing market.

Source: The Globe & Mail

 

Rajat Pathak
Sales Representative 

CENTURY 21 Miller Real Estate Ltd. 
Brokerage Independently Owned and Operated
#4 Office in Canada 
By Production CENTURY 21 Canada 2013
467 Speers Road, 
Oakville, ON L6K 3S4
Direct: 647.233.2777

Email:  rajsells@live.ca
www.century21.ca/rajat.pathak

 

 

 

 

 

 

 

 

 

 

 

Rajat Pathak

Rajat Pathak

Sales Representative
CENTURY 21 Miller Real Estate Ltd., Brokerage*
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