Here’s a question I get everyday… “What do you think will happen to house prices?”
Recent talk of a potential Canadian housing bubble has got buyers wondering and waiting. They’re afraid to buy now and make a mistake. Will prices go up? Will they go down? And… is there in fact a real estate bubble?
In my opinion there is no housing bubble here in YVR.
Strong local employment and a robust local economy are supporting house prices. Our Canadian economy looks to be in good shape, as long as people have jobs, property prices will remain where they are and increase. Waiting to buy is not a good strategy, prices will increase. (Of course I am biased because I work in the industry)
What about Interest Rates?
The news is filled with stories about rising interest rates and that’s causing buyer anxiety.
Many buyers don’t realize that if they get into a good 5 year fixed rate mortgage now they’re protected for 5 yrs. Prudent consumers should be planning ahead for renewal at higher rates. They should think about their future monthly payments should rates rise and look at their projected income in 5 years to see how those compare. If the new payments at renewal are too high compared with their monthly income maybe spending less now is a good plan, or perhaps lowering debt over 5 years will help.
I believe rates will rise slowly over the next 2 years then level off around the 6 to 6.5% range for a 5 year fixed rate mortgage. (I’m talking about broker discounted rate here).