We’re living in interesting times.  Covid was projected to slow down or crash the real estate market but it’s actually shown us the opposite.   Here are 3 quick and easy ways to know where the real estate market is going:  
 
 
1. Look at the history and look for trends
2. Look at the rules around mortgages. 
3. Call your favorite Realtor and get me working for you!
 
Homes are selling quickly as buyers try to capitalize on low mortgage rates before they rise back to last year's levels.  We may see a little bit of a burst of activity just before a cool down by mid-summer as Buyers try to get in before the stress test new rules are implemented.  More new listings are expected in April & May & June of 2021 as they traditionally do heading into spring, however, the buyers are buying so the pool of buyers may be getting less now with the new lending rules coming into play as of June 1st, there may be even fewer buyers that can afford. Let’s have a look at the history of new listings to show you what I mean.
 
This is a 5-year graph of just the new listings.  You can see the trend going upwards for new listings right now as we head into our spring.  It peaks in the new listings somewhere around April to July.  Next, let’s look at the ‘Active Listings’.  You’ll see that it peaks for active listings in July/August.  This is why I’ve been telling my clients to list as soon as possible as soon as they were calling me in January.
 
The trends for total sales in a month typically peak in May, it may continue the trend but typically not more than what we see sold in May.
 
~What is the stress test?  On April 8, the Office of the Superintendent of Financial Institutions (OSFI) proposed a higher mortgage stress test level, making it harder to qualify for home loans.  It’s to ensure if the interest rates go higher you can afford to pay it.  This would make it harder to qualify for a home loan, shrinking the pool of qualified borrowers and ultimately bringing down some of the upward pressure on house prices.  If you are already preapproved, you’ll be fine.  If You’re not, I recommend that you go get preapproved fast as the deadline is June 1.  Speak with your mortgage specialist and see how this will impact your personal situation. However, if this policy has the desired effect of slowing home value appreciation, it may be a good thing for first-time homebuyers in the long run.
 
The housing market is largely being driven by two factors: a shortage of available housing inventory and extremely low-interest rates. We will start to see an increase in inventory due to 3 reasons: We traditionally see an uptick of inventory as we usually do this time of year, the building season is also upon us, so we will start to see builders trying to sell their inventory and take advantage of the market right now and lastly, OSFI changes to the lending rules for financial institutions will have an impact on housing inventory in the long term.  
 
So If you’re looking to sell your house basically what I’m trying to say is listen to your Realtor.  Look at the trends, don’t be stubborn, and try to take advantage of the market and hold out for that little bit extra because eventually, the busyness may start to cool off.  
 
Yes, interest rates are on the rise.  Let’s put this in perspective though because interest rates really aren’t that high.  They still sub 3% currently.  My mom paid 18% in the ’80s and she still survived.  You’re laughing at 3% or even 5%.  There will be some buyers out there that still won’t buy because they think interest rates are too high and they’re tripping over dollars to pick up pennies.  I’m sure you’ve heard the old adage, “Do you know the best time to buy a house?  It was 20 years ago!  The next best time to buy real estate, is today!” (by the way, the posted interest rates 20 years ago were  7.5%)
 
1. Look at the history and look for trends  
2. Look at the rules around mortgages. 
3. Call your favorite Realtor and get me working for you!
 
Thanks again for watching and see you next month!
 
 
 
PS:  If you’d like to learn more about how I can help you navigate through this unique market, text me at 778-784-7845.
PPS:  If you thought this information was helpful, please share the love with your friends!
 
 
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