Following the sustained gains realized in the robust condo segment of Toronto properties, average annual prices remain stable. The new mortgage rules announced by OSFI are expected to temporarily boost the autumn Toronto real estate sales; they will take effect from January 1st. Stomp Realty acknowledges that due to these new rules, families in the Toronto neighborhoods will experience a challenge. They stand to relinquish up to 21% in real estate and condo purchasing power.
Application of More Stringent Stress Testing
As real estate dealers and prospectors, we foresee the possibility of these stringent tests instigating a scramble. We advise any prospective home buyers in neighborhoods such as Danforth to make use of this time before implementation. You just might score a good deal during the anticipated short-term rush. While we expect the 2018 spring market to be considerably cooler than previously, what will happen after the Jan 1st deadline remains uncertain.
Overall Market Is More Balanced Than Before
As time presses on, the stark difference between freeholds and condos is showing clearly. Though the average prices have risen by 2%, condo sales are at their best with an impressive 17% increase in sales. This year has seen significant changes in freehold prices; they were consistently flat last year. A closer look at GTA averages from different neighborhoods amplifies these divergences. Downtown Toronto, our real estate specialty, experiences high market competitiveness. Of all regions, the York area seems hardest hit by this relative competition.
Foreseeable significant Damping Effect
The proposed lending curtailment, if implemented as is, will consequentially slow down interest rates. If you are a home buyer who didn’t require insurance against your mortgage (due to the 20% down payment), you will have to prove your competency. Should the interest surpass the 5-year benchmark set by Bank of Canada, we will help you prove that you can fully commit. This new measure is expected to unsettle the market more than other previous federal measures. In the midst of all this, you can still rely on Stomp Realty to secure you the best deal.
Requirements May Disqualify 1 in 5 ‘Move-Up’ Home Buyers
Since move-up buyers currently qualify for insured mortgages and home equity, they stand to be disproportionately affected. If you’re like most clients, finding ways such as gifting your parents or other sources could lead to uninsured loan qualification. Our decades of combined real estate experience has taught us many more successful strategies. Contact us today and we’ll be glad to share!
Banks Might Hold Off On Rate Hikes
The lead by provincial governments to introducing market cooling measures instigated this tightening of restrictions by OSFI. This mandate focuses on introducing soundness and safety to financial institutions regulated federally. OSFI also promised to review stress testing in retrospect to the expected change in market conditions.
Are you a move-up home buyer in the Toronto real estate precincts? Stomp Realty is here to offer you unparalleled guidance and periodic insights. As January fast approaches, avoid being caught flat-footed by the looming changes by making your plan as early as today. Contact us today and our responsive staff will get in touch with you promptly.