With the recent changes to interest rates we have seen a market shift locally and nationally.
Many people are wondering whether this is a good time to buy a home or if it’s better to wait until interest rates readjust downward. This is a very valid question given the changes to interest rates and market conditions we have recently seen.
Here is some food for thought:
The interest rate you get for a mortgage today can be renegotiated in a year or two depending on what term you choose with your lender.
The price you pay for a property is locked in on the day that your offer is accepted by the home seller.
If you are able to buy a home today for $30,000-$60,000 less than you would have been able to just a few months ago, this lower purchase price will MORE than offset the increase in mortgage payments.
Once interest rates adjust downwards (some experts predict this will happen in the next 3-6 months) you will then have a lower payment AND a lower original purchase price.
When rates go down, home prices rise – that’s just economics 101.
This also doesn’t take into account how much money you will save on closing costs (land transfer tax in particular as it is based on sale price) as well as your CMHC insurance premium, if you are taking out a high ratio mortgage).
Sometimes a paradigm shift presents opportunities which can be very profitable.
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