Again...just an opinon piece. Debatable. Take what you will from it.
With rates making their way up (some having already gone up on the fixed side) and the variable rates to follow the benchmark index rate as early as June/July, will this be the catalyst to slow down pricing in Toronto and pull some buyers out of teh market?
In my humble opinion, likely not. We still need to work off the basics of supply and demand. The demand remains very strong (artificially so maybe) with emergency loan rates, fear of upcoming HST (which is overblown unless your buying new construction) and variable mortgage rates to increase.
All that said, there is a strong immigrant base who need homes, Canadians are not showing trepidness in the wake of increasing their debt levels (not a good thing, but it isn't keeping them out of the mortage line ups) and supply has been light versus demand.
It's my humble belief that supply will not keep up pace with demand, that interest rates in the next while will not rise as quickly as they need to to make a dent in buyers decision making, the new tests for cmhc buyers qualifying for stricter mortgages still enable banks (from what i'm hearing) to make mortgages work---all these combined suggest that buying in this spring market will continue strong, prices will continue to make their way up and all the resistance factors namely; HST, mortgage rates; mortgage qualfications; debt levels---won't slow down the demand.
We need to see much more supply to reach a different market in Toronto.
So, shop around, get the best mortgage and find the best house for you while not pushing yourself to the brink.
Happy Long Weekend.
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