According to the recent reports, with regard to home buying, many home buyers plan to wait and see. This is required for them to analyse the current rates that homes in Canada are having. This is why homebuyers are opting to wait for more interest rate cuts. The wait is especially done to see for more interest rate cuts from the Bank of Canada. This is to be done before jumping into the market, while other home buyers plan on hoping to see prices drop further.
The home buyers plan to see if the interest rate cuts come forth and on that basis, they will be analysing. However, with regard to the present state, many statements have started coming in. This is strongly with reference to what the home buyers plan to do currently,
“Some potential homebuyers are thinking: ‘Well, there’ll be more cuts, I’ll wait and see,’ and you also have people sitting back and saying: ‘You know what, maybe the prices will come down too,’” Butler, of Butler Mortgage, told in a Friday interview.
“(It’s) a classic deflationary sit-back-and-wait consumer pause to see what happens.”
Home Buyers Plan: What Has The Bank Of Canada Done Yet?
The Bank of Canada with reference to what the home buyers plan have lowered its overnight lending rate. This has been lowered down to a rate of 4.25 percent last month. After this, it has also signalled that it is prepared to drop rates further. This can be done as long as the rate of inflation continues its downward trend which is going on recently.
It was the third-straight quarter percentage point rate reduction by the central bank. This was after it raised its headline rate to five per cent in July of last year.
What is Keeping Rate Cuts From Spurring?
With regard to what the home buyers plan to do with accordance to buying homes, Butler has mentioned a hefty statement. He has mentioned that the one thing keeping the recent rate cuts from spurring any meaningful activity in the housing market is a lot of uncertainty. This uncertainty is prevailing in the minds of various Canada people. These thoughts are basd around how much a seller will be able to get for their home when looking to upsize.
“If you own a home and you want to go to a bigger home, you’re never quite sure what you’re going to get for your home,” he said.
“We went through 14 years where you knew almost to the penny what you were going to get because of generally a rising price environment, so that creates a challenge.”
Butler also noted that many Canadians are in uncertain or precarious employment situations, and that “people aren’t always interested in buying a new home when they’re worrying about their jobs.”
What Are The Condos Going Through?
While the home buyers plan, on the other hand, Butler said that when it comes to the condo market, virtually all speculative investors have left the space. This is because the prices have fallen and sales have slowed.
“We don’t see any investors in the condo market; absolutely none,” he said.
“Over the next two years, as much as 60,000 units (are) coming on stream. Based on some delays and then some big activity about five or six years ago. And boy, they are under price pressure, there’s no question.”
Butler also said that this seemingly over-supplied section of the market is starkly contrasted with nationwide calls. This is being done especially for increased housing supply – a dynamic he called “absolutely puzzling.”
“It’s just been shocking to me. Unfortunately, we probably built a lot of the wrong thing. The condos are just too small, and they’re just meant for investors,” he said.
Butler also said that for those who are entering the housing market, the variable-rate mortgages are still the smartest option.
“Get variable, that’s probably the only sure thing that you know is coming down,” he said.
“Then you have a lot of options; you can convert for free to a fixed rate next year and maybe your timing could be great.”
Conclusion
Thus, this is what is with regards to what the home buyers plan to do things. Plus, many things such as the interest rate cuts too need to be taken into account. This is necessary as buying a home i s regarded as an investment. Plus, its known to be an investment for life. This is why for all these reasons one must take care of these things and thus, get forward with it.