.jpg)
Thanks to historically low interest rates and a recovering economy, Canadians are buying homes at a record pace. According to the Canadian Real Estate Association, home resales hit an all-time high in December, up 72% from December 2008! Of course, this is great news for the housing industry and overall economy, but the federal government is sending signals that it would like Canadians to proceed with caution.
The Bank of Canada has already announced that it will likely start raising interest rates by mid 2010. Within a couple of years, mortgage rates could be as much as one or two percentage points higher. What worries the government is that some of today's homebuyers are taking on mortgages they can just barely afford, and when rates start rising, payments may be unmanageable.
To encourage buyers not to get in over their heads, the government is hinting that it may take steps to cool down the housing market, if necessary. Possible actions being discussed include increasing the size of the down payment (currently at 5%) and/or reducing the maximum allowed amortization (currently at 35 years). Both of these steps could potentially cut many home buyers out of the market.
If you're considering buying in the next year, you may want to act sooner rather than later. Buying now means taking advantage of record low interest rates, a manageable down payment and a more flexible amortization. If you wait too long, all of these advantages may be lost and homeownership could suddenly be out of reach.
As your mortgage advisor, I'd be happy to analyze your needs and present you with an affordable plan, whether you're buying for the first time, renewing or refinancing. Please talk to us today before Ottawa closes the door!
Mortgage for Change Blog
Warning: Ottawa may be planning to make it harder for you to get a mortgage.
Wednesday, March 10, 2010
1
Subscribe
Recent Posts
- The Fed’s Constraint on Canadian Rates
- Financial Update
- Free Mortgage Calculator for your phone
- What 95% of Canadians Don't Know
- Tips for Minimizing Costs and Maximizing Value in Your Home
- Strategic Ways to Invest Your Tax Refund
- Rising Rates - Are Big Banks Jumping the Gun?
- Smart Rental Tip - Tenant Screening
- Bank of Canada Announcement
- Warning: Ottawa may be planning to make it harder for you to get a mortgage.
Tags
Investing mortgage rates credit management, financial health economic indicators Renovating rates Donations First time home buyer rental tips, investment mortgage get a mortgage mortgages mortgage calculator bank rates Tax Tips
Comments
Post has no comments.