We are now full steam into 2010 and many people are beginning to think about buying or selling real estate. As you are making your plans, please consider the following points.
1. Interest rates are on the rise
Home buying has continued its hot streak from 2009 into 2010. Interest rates remain low and continue to pull buyers into the market. The threat of rising interest rates in July will have people rushing to get into new homes before the rates start to move.
2. HST will be introduced this July
While the tax will hit those who buy newly constructed houses hardest, it will also add to the costs of buying an existing home. Many buyers are trying to get their transactions completed before the new tax arrives this July.
3. Choose whether to sell first or buy
If you are selling a property that will move quickly, it is advisable to buy your new home first and then sell once you have found ‘Your Dream Home”. You don’t want to be forced into buying a property just because you don’t have a property to live in anymore. Follow what is happening in your area to see if homes are staying on the market for a long time or if the sold sign goes up the same day it is listed. Knowing how quickly your current home will sell is the best indicator of whether you should buy or sell first.
4. Abundant Spring Listings
Last spring signalled the end of the brief housing down turn that hit Canadian real estate. Although the market was on the rise, many were still sceptical and decided to hold off selling. Now that the market is strong and stories of multiple offers are passed around, sellers are seeing this spring as the time to jump back into the market.
The injection of housing supply will help alleviate the upward pressure on prices and give buyers more selection to choose from. Hopefully this surge of housing supply will prevent housing prices from going through the roof and bring an equilibrium to the real estate market.
5. Is it worth it to rush?
There are different schools of thought as to when to buy this year. Many feel it is best to jump in before the extra tax hits and rising interest rates. But wait...if everyone is rushing to avoid that, won’t that affect prices? Of course it will. You will have to weigh the benefits jumping in early versus waiting until the feeding frenzy has subsided. A client of mine just lost out on a house because their offer was only one of nine submitted. The home ended up going for $61,000 over list price! The question then becomes, will the tax and slight rise in interest rates be worth getting into a bidding war over? Some feel it is best to wait until the action has cooled and buy a home, with the extra costs, at fair market value.
There is a lot to think about when buying or selling a home. For a free, no-obligation chat about your real estate options, please call me at 905-220-9198 or visit my websites www.seankavanagh.ca OR www.seansells.ca.