Buying a home for the first time, moving up to a second home or investing in an investment property has rarely presented a better opportunity to do so.
I trust everyone had a great long weekend and an excellent Family Day. My weekend was busy with open houses and showings and I have to add, it was nice to hear positive feedback from many homebuyers and seekers that, we’re really not so badly off here in Toronto afterall. We live in a great, vibrant city, mortgage interest rates are hitting historical lows (Prime is now 3.0% and a 5-year discounted rate quoted to me is 4.20%).
When you combine that with lower prices, affordability is improving dramatically. In early 2008 that index reached 33% (ownership costs as a % of pre-tax income). We hit a ‘recent’ low back in 2003 when this measure was around 22%. It’s expected that the recent price/interest rate changes have brought the affordability index back down to around the 28% level which is excellent.
The prediction is for the Bank of Canada to drop their rate again at their March meeting which would bring the prime down to perhaps 2.5%… this would make the rate on a variable mortgage to be in the 2’s or low 3’s!
In my 10+ years in the real estate buisness, I can say, with a fair degree of accuracy, that this market is different. I don't see the market staying the way it is for years to come as in past recessions. Previous real estate recessions had elements in it which we do not have. Higher interest rates, higher unemployment and higher inflation to name a few. This market is different. What we have is a stagnant market which will remain this way for perhaps several months in 2009, but will come out of it strong in 2010. When the market turns around, prices will increase, and mortgage interest rates will increase. This slower market will be short lived.
For the first half of 2009 we have an incredible real estate window in front of it. An amazing opportunity to purchase attractively priced properties than in past years, incredibly low mortgage interest rates, an abundance of mortgage money for qualified buyers is right in front of us.
Now is the time to buy a property, to move up, to add to our real estate investment portfolio's or to begin one. I have never seen a better time to buy property in Toronto. All of my clients who are able to use equity from their homes should consider buying an investment property of some sort. Clients who purchased properties in the early 2000's and who need a bigger family home should do it now.
The real estate opportunities of the next few months are too good to let go by without getting my clients and myself involved. The "Window of Opportunity" in our present Toronto Real Estate market should be taken advantage of. I would be remiss if I didn't make sure I inform everyone about the incredible opportunities that exist in our real estate market.
If your job(s) is/are secure and the scenario is right, it's a great oppotunity to be the early bird - who gets the worm!
Real Estate is always a great investment, and now is the best time in years in buy.
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