In many parts of Canada home prices are falling. Before making any investment there are some factors that you should consider. Some of the factors that need to be taken into account before purchasing real estate, what the mortgage rate is and how much a family spends every month amid rising costs of living are.
In July, the latest data from the Canadian real estate association showed prices hit $629,971. It amounted to $650,760, a three per cent drop from June on a seasonally-adjusted basis. The average national price was $543,920 when pandemic lockdowns began.
By the end of 2022 the national average home price will rise by 10.8 per cent on an annual basis to $762,386.
Is this the right time to invest:
A professor of data science at Toronto metropolitan university, Murtaza Haider, says no one can predict if it’s too early or late, so Canadians need to take a more practical approach. Lower prices could even mean more money going out.
Right time is when you’re ready:
The right time is when you’re ready to purchase based on your family and financial circumstances etc. People who want it to happen don’t end up buying when home prices fall.
When they see an asset losing value, with housing prices going down they become concerned and say, why should I buy now even though they wanted the prices to fall, and the moment they start falling, they wait and sometimes don’t end up buying.
They further contribute to lowering demand. Tons of people are actually purchasing real estate. John Pasalis, president of Realosophy Realty Inc. in Toronto, told the Canadian press that the fall is going to be interesting because we’re probably going to see more buyers jumping into the market.
If an individual has the financial means to purchase real estate then now is a much better time to buy. So it’s important for buyers to have a very tough conversation with themselves.
People should also be mindful while purchasing a property. Cost of materials and labour has skyrocketed. Look around and explore different neighbourhoods, explore different types of properties with an eye on those that are pre-approved and have a mortgage rate locked in with their lender.
Haider says the reason behind selling that property should also be considered before buying.