Think this is a Housing Crisis? Think Again…
Real Estate Market Update in Hamilton – Burlington
What’s Happening in the Real Estate Industry?
The Average Home Price in Canada is now $637,000, as per CREA (Canadian Real Estate Association)
My Message to Buyers and Sellers: Don’t be afraid to enter the market right now!
We are in an inventory shortage in the area.
Making it a good investment, and a good time to Sell Your Home for Top Dollar.
Even if the people who deferred their mortgage payments, sold their homes after the Covid pandemic, we still wont have enough inventory to satiate Buyer demand.
Market Highlights:
- Low Mortgage interest rates are fuelling Buyer demand
- At home work space is more popular, making larger homes more popular
- Most people on CERB are renters
- In just the last year, people have built as high as 14% equity in their homes!
- Every Sale of a Re Sale homes puts at least $65,000 into our economy (People renovating etc), so housing industry is helping the economy.
- Rental prices are high, and still lots of tenant competition
- Many people are buying cottages
REMAX Escarpment Stats:
Listings are DOWN, Sales are UP
Burlington Highlights:
- Year to Date Average Price in Burlington increased almost 15%!
- There is lots of Demand for Townhouses and Detached New Construction Homes
- Dollar Volumes are slightly off from last year
- Barely a 5 week Months of Supply
Hamilton Highlights:
- Year to date price increase of 11.75%
- Dollar Volumes are down by around 6%
- Hamilton Proper, just over one month supply
- 50% inventory compared to last July
- Days on Market down by 30%
Hamilton Surrounding Area Highlights:
- Price Increases about 10%
- Dollar Volumes increased 55% over last summer!
- More Sales, Higher Priced Sales
- End of Month inventory down almost 60%
- 5 Week Supply of Housing Inventory
Niagara Highlights:
- The Star of 2020!
- Year to Date Average Price is up by 16%!
- Year to date Volume up 7% YTD
- Months of Supply dropped by a month
- 2.32 months of supply
Mortgage Update
Pre Approvals:
When we are in a market with this much competition, you NEED to get a pre approval as a Home Buyer.
You must ensure you have the income, and down payment to buy the home you want. Especially when you are in competing offers and could have to drop your financing condition.
What if you go in without financing condition?
Low Appraisal?
- Appraisers are using past comparable sales, historical data. The home you just bought could be worth more now then it was 3-6 months ago.
- Get Pre Approved, so you know your loan to value and can thoughtfully offer based on your pre approval numbers.
- Rarely see a low appraisal, but get your Realtor to explain what happens here.
Know your worst case scenario, with Plan A, B & C, to ensure your transaction closes.
Remember: Get your Mortgage Broker all of the Documents they Request ASAP!
CMHC changed their guidelines, making it more difficult to get a high ratio mortgage (Less then 20% down).
Genworth and Canada Guarantee, have not made these changes.
Mortgage Deferrals are case by case. Contact your lender if it makes sense for you to defer your mortgage payments.
Bank Of Canada:
Benchmark 5 year mortgage (rate which BOC reports on) went from 5.04, 4.94, 4.79. It keeps dropping, and they likely won’t go up for the next few years.
That is 25 basis point spread, which makes it more affordable for people to buy a home.
Right now, to borrow $500,000, it costs $10,000 a year.
Lawyer Update & Tips
Lawyers are very busy in this bustling Real Estate Season.
Since people are under extreme amounts of stress and pressure, lawyers are finding that there are wrinkles in financing and have to deal with that.
Title Insurance.
Every purchaser should be getting title insurance, whether you are getting a mortgage, or paying cash for your home.
Title Insurance is different then home or auto policy.
4 other distinct Companies offer title insurance, and once you buy it, it gives you coverage for as long as you own the home. (You only pay once!)
It covers you if the previous Seller didn’t pay their property taxes or utility bills, liens on title from contractors, ID theft, mortgage fraud, lawyer or clerk negligence or mistakes.
Assignments.
They’re tricky things, so proceed with caution.
Find out what accountant and lawyer you want to work with, and follow their advice.
There are Capital Gains and HST implications that must be in the contract.
Status Certificate
When reviewing a status certificate when you are buying a condo, your lawyer will take 2-3 days to review the documents and give you a chance to review the rules of the condo corp.
Your Lawyer will review the financial health of the condo unit, and the corporation. They also sometimes need to talk to the property manager, which may take time.
Let me know if you need more information about Status Certificate Review.
Rolling Close Clause
If you are a Seller and still need to find a home, you can ask your Buyers to accept a rolling closing date clause, which let’s you extend closing date to give you time to sell your home.
In general, the real estate market is moving and grooving, and there are lots of nice people I have been working with, to either get into the home of their dreams (that they will live, work, and play at!), and to help Sellers capitalize on the awesome real estate market conditions.
If you are considering moving in to a new home, reach out to me to talk about Selling and Buying, and we can go through everything you need to know to make an informed decision.
Thank you for Trusting me as your Real Estate Resource
