August 2023 - Latest Market Update

The Summer Sizzle

Mortgage rates have increased to a new summer high since the last rate increase by the Bank of Canada last month.   Where do we go from here?  The consensus is that the economy will begin a slow down and the rate increases will stop, and the interest rates will begin to fall.  This is certainly possible but maybe the bigger question is when will this happen?  The answer to that is even more difficult given our Country’s population boom.  I may not be confident about the timing, but I’m confident that the Bank of Canada will be reluctant to drop rates too quickly.   I believe the best we should expect to see is rates beginning to ease next Spring.  

Many borrowers are being turned away from the banks.  Don’t let the bank be your final answer.   There are options available to help whether you are refinancing, renewing or just need money.    

• 35 year amortizations can be offered.  This helps keep your payment low especially if you were not prepared for the higher rates upon a renewal. 

• Private 2nd mortgages.  This helps raise funds you may need and may allow you to maintain the low rate on your 1st Mortgage. 

• Private 1st mortgages.  This can be a great short-term solution and rates will very depending on equity position.

• Vendor Take-Back Mortgages.  This may be an ideal for sellers looking to earn a steady stream of monthly income secured against the home you sold.  

Private Mortgage Rate Sale:

Current blocks of funds from recent payouts looking for a new home:

• $125,000 as low as 9.95% (up to 70% equity)

• $300,000 as low as 11.95% (Up to 80% equity)

• $150,000 as low as 13.95% (Up to 85% equity)

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Recently SOLD and is now one of the most expensive homes ever sold in North Delta:
11932 Clark Dr, Delta

June 2023 - Latest Market Update

40 Million and Growing

The Canadian population hit the 40-million-mark last week and the Real Estate crash many were expected has so far this year has been avoided.  Economists predict that Canada will need 3.5 million additional housing units by 2030 to restore affordability.  While the housing growth has not kept pace the high interest rates have had an unexpected affect on Real Estate.   New listings across the Country have been falling; reducing the supply.  It has been said that the high mortgage rates have been a deterrent to homeowners’ listing their homes for sale.  This combined with increased demand has driven prices higher, which of course has worsened affordability.  This doesn’t mean selling in today’s market is easy.   Homes that are well priced and well marketed are selling successfully.  Being in the industry for as long as I have, I’ve seen it all – the good and the bad.   It's not the glitz that gets home sold successfully, but rather smart practices and good advice. 

Mortgage rates stay elevated. If your mortgage is up for renewal, you will likely be surprised by the rates being offered and the increase of the new payment.  In some cases, borrowers could see an increase of up to 80%.   Many economists worry about the impact to borrowers especially by 2025 when many borrowers will have their mortgage due for renewal from the time they locked into very low rates during covid.   Don’t wait to be shocked.  Act now and explore your options by contacting me. 

• Fixed rates vary from 4.90% to 6.05%.

• Variable rates range from 6.20% to 6.80%

• The prime lending rate is 6.95%

Don’t be stuck for money.  Private lenders are looking to get you money and often you can access up to 85% of the equity in your home. 

February 2023 - Latest Market Update

Making 2023 your most prosperous year yet

In the Chinese culture, 2023 is considered the year of the Rabbit.  The sign of Rabbit is a symbol of longevity, peace, and prosperity in Chinese culture, and it is not the year to take wild risks but rather to focus on building a solid financial foundation. To make 2023 one of your most prosperous years, I believe it’s important to have a solid plan.  

Interest rates and inflation are the highest it’s been in decades. The stock markets are volatile and real estate sales have slumped.  Although sales are below historical averages, inventory levels remain very low and homes that are well priced are selling very successfully.  When it comes to selling your home, some little things can make a huge difference. 

Here’s just a few tips to maximize your sale price:

1. Ensure your listing is launched with photos.   Photos evoke emotion and when they are not available at the time of the launching the listing, buyers can move on to other opportunities. 

2. When you can avoid having your realtor use a Lockbox.  They are paid to sell your home so make sure they make effort to be present at all showings to showcase, answer buyers’ questions and sell your home for maximum dollars.

3. Do not allow your realtor to use other realtors to host your Open House.  No one knows your home better and cares more than your listing agent.  Features that make your home unique can be overlooked. 

Mortgage rates have begun to ease, and we are starting to see some great deals on mortgage rates.  Five-year fixed rates are being offered as lows as 4.89% and variable rates as low as 5.50%.  When it comes to refinancing or renewing your mortgage consider the following:

1. Banks are not always the best option for a mortgage.  Credit Unions do not need to follow the qualification criteria that banks must follow, and this may not only save you thousands of dollars in interest, but it may also make a huge difference in what type of home you can purchase. 

2. Credit reporting agencies have changed how they determine your credit scores.  Avoid utilizing credit cards as it has a negative impact on your score.  A high credit score usually gets you a better rate. 

3. Rather than refinancing your existing mortgage that may have an attractive interest rate, consider a 2nd mortgage, and then refinance in the future to combine the mortgages when rates are more attractive. This could possibly save you thousands in interest. 

Let me show you how I can help, contact me today. 

December 2022 - Latest Market Update

2023 Will Be A New Environment For The Real Estate Market

Recently, the Province introduced new Strata rules which prevent rental and age restrictions on all buildings (except for 55 plus age restricted strata’s) with the goal being to create more available housing.   January 3 will be the start of the Home Buyer Rescission Period.  This change to the Property Law Act will allow a homebuyer the right to withdraw from a purchase agreement within three business days of an offer being accepted.  This will have a material change to how homes are sold and purchased.  Also starting January 1, non-Canadians will be banned from buying residential property across Canada until December 31, 2024. 

Since March 2nd, 2022 the Bank of Canada has steadily increased lending rates. The overnight rate currently sits at 4.25%, and the prime rate is now at 6.45%. To qualify for a mortgage the rate used is close to 8%.   Next year the market will absorb the impacts of a higher rate environment and so far, the impact has been a decline in home sales and skyrocketing rental rates. For the latest real estate stats:  click here

At first glance all of this may appear scary, however; inflation is already starting to moderate and is expected to fall early next year along with interest rates.  Immigration to BC is surging; and there remains a strong demand for homes.  Well-priced homes are selling, and buyers can now take advantage of a more balanced market.

Homebuyers continue to have choices for mortgage financing.  We are seeing a surge in demand for private lending which can offer a short-term solution for raising money to either make a purchase or to cover any expenses.  Don’t be stuck keeping high balances on credit cards where you can use the equity in your home to reduce your interest costs and your monthly payments.  For the latest mortgage rates:  click here

For many homeowners; downsizing or making a change can be challenging.  Hiring the right professional can make a world of difference.  Next year we are offering improved services to help with a changing market.  Some of these changes will see new marketing strategies that will help expose your home more domestic and international markets; cash back to help with moving expenses, free junk removal and more.   More specifics to follow in the new year.   

Wishing you all the best of 2023 and Happy Holidays

October 2022 - Latest Market Update

Is Inflation Impacting Real Estate?

The Bank of Canada has sent a clear message to Canadians as it executes the most aggressive round of tightening in the Country’s history and increases the bank rate by 50 basis point, it’s sixth increase this year.   A recession here and around the world seems inevitable as borrowing rates reach levels not seen in decades.  A 5-year fixed rate mortgage is now reaching over 6% and variable rates are reaching above 5%.  Private lending rates have also increased, but at a more modest pace.  

The Canadian Real Estate market is also feeling the impact with increased listings and a significant reduction is sales.  Prices have begun to soften, more so in some areas and most homes are selling under the list price.   Real Estate developers have also begun to delay and/or cancel projects.  Governments are not helping, and they continue to be a huge part of the inflation problem.   As the Country enters a recession, Government budgets will become strained, especially in BC where a huge percentage of the Government’s revenue comes from taxes on Real Estate. 

That being said, there are some reasons to be optimistic.  Rental rates have increased significantly and is allowing many property owners to meet their increased expenses.  Metro Vancouver’s rents are some of the highest in Canada and it’s allowing many investors from having to sell their property.

The Bank of Canada’s tightening is beginning to work, and the inflation rate has already slowed and is expected to fall further over the next few months.  This should provide some relief of further rate increases and possibly allowing the Bank of Canada to start easing monetary policy next Spring. 

If your mortgage is up for renewal try to avoid locking-in to a fixed rate beyond 3-5 years.  Variable rates are still great options for some borrowers, but caution to the Bank/lender you consider.  Some mortgage lenders will increase the payment with the increase in rates, but do not lower payment when the rates begin to fall.  Check with your lender before making decisions. 

Minimize borrowings as much as possible.  It may be better to take some equity out of your home rather than carrying balances on credit cards.  Many private lenders are sitting on a huge pile of cash and are eager to lend out the money. 

If you have a pre-sale purchase completing soon and the bank said no, don’t stress.  There are plenty of options to help get the deal completed.  

Did you know: In Scotland, homeowners have been known to paint their front door red when they pay off their mortgage.