Canadian banks cut prime rates by 50 basis points
All Major Canadian banks have cut their prime lending rates on Tuesday after the Bank of Canada, the country's central bank, cut its key interest rate by a half-point to a record low of 0.5 percent. As most of the major banks are willing to pass on this discount to general public, most of them have reduced their prime rate from 3% to 2.5%. This effort have given consumer the capability to lock in lower fixed mortgage rate for longer fixed term. Be assured, that this rate will not stay around for ever, as Bank of Canada have signalled for the first time that it may resort to quantitative easing in the future. So, dont wait any longer if you are planning to buy, lock in your rate immediately. If your feel your bank is not offering you the best rates, call me today, I work with few well reputed mortgage brokers in GTA, to get my Buyers excellent rates.
Keeping the Media doom & gloom aside, reality is that current real estate market is far active then December and January i.e. houses are staying for shorter period and more buyers are there in the market compared to previous few months. If you are looking to list your property, this is good time to get in the market, as you may get surprised with the results. If you want to wait to list and have got an average looking property. Guess what! You will be having a very strong competition, as due to increase in Unemployment rates, their will be lots of houses like yours on sale.
If you are looking to buy, there cant be better time then this, as along with taking advantage of lower interest rates, you can also get some exceptional bargains in the market. More you wait, more Buyers will be competing with you to get the same property, which ultimately will lead to increase of prices, specially for properties which are looking little better then the competition. Also remember:
1. Decrease in lending rates will encourage more buyers in the lower income group to buy homes.
2. This will also encourage Investors to buy cheaper properties for investment.
3. Most Parents prefer moving in Summer i.e. start looking for houses in April/May to get a closing in July i.e. during start of summer vacation of their children.
4. On average approx. 250,000 immigrants come to this country every year, out of which most come in Spring/ Summer and largest chunk comes to settle in GTA. Recent statistics suggest that the number of Immigrant Investor Program applications deriving from citizens of India alone have increased 500% in the past 12 months, which will only increase above number of immigrants and outright Buyers, specially the ones having enough of cash in hand to spare for their housing needs.
All above reasons will only increase the competition for average home buyer, specially if you wait beyond March. So make a smart move, jump in the market right now to get the maximum benefit. Give me a call for any further questions, I will be happy to be of any service.
Few of my respected readers have raised questions in reference to my last Newsletter. I really appreciate their questions, as answered questions are better then unanswered ones. I though it will be good idea to clarify few things as below to everyone:
When I say list your house now, I mean sellers having average looking house, currently WAITING to list in peak summer, thinking they be able to get a better price at that time. I am suggesting them to list right now, as they will have lesser competition, so their house are expected to go faster and at better price as compared to summer, as the number of listings in the market are far less as compared to last year, whereas the demand is increasing day by day with peak season around the corner. As the summer will approach, all waiting sellers who are in NEED to sell, will finally list, which will triger the drop in prices, due to increase in inventory. Once again all this is for average looking home with little or no upgrades and have nothing special to offer.
I always try my level best to make my listings look the best. Most of my listing packages offer the services of a designer included, whose only job is to help us make your home look more presentable with minimum possible expenses.
Secondly, coming to the point that more buyers will be there in the market in summer, keep in mind, so will be the number of houses. This will increase the bidding for ABOVE AVERAGE looking houses, which in hot market sell above the list price due to multiple bidding and in current market are selling for negotiation of approx. 1%-5% ONLY, varying property to property, which is still an exceptional deal for Buyers, as majority of them are looking ONLY for this WoW category, as per my first hand experience. Whereas, houses offering little less i.e. majority of inventory, will face even more competition then now, as most intersted Buyers of that category, who are fewer, will try to find a steel deal out of that large chunck of available inventory.
Overall, summer may show us larger volume of transactions, but higher bids are expected only for the properties with that EXTRA +++. Balance of them will only see larger difference between listing and selling price due to larger inventory.
I hope that explains my last newsletter better. Once again, I would encourage everyone to clarify your doubts, rather then leaving them unsaid, as that will mean nothing to you or me. Please feel free to call.