Recent Changes in Real Estate: What You Need to Know

BY Scott moore, REALTOR

You might have heard about what’s been happening within the real estate world estate recently, there has been loads of changes and movement and I wanted to summary the main points:

 1. The Bank of Canada reduced interest rates by 0.25% at each of their last three announcements. The overnight rate was 5% in early June and is now 4.25% today. 

2. The US Federal Reserve dropped their interest rate by a whopping 0.5% recently, which predicts larger drops to come here in Canada. Combined with inflation rates dropping on target and unemployment rising, it's almost guaranteed that rates will be dropped again at the next announcements on Oct 23rd and Dec 11th, possibly by as much as 0.5% at each time. 

3. Big changes for mortgage rules in Canada to take effect Dec 15th. Insured mortgages are now available for homes up to 1.5M, up from 1M currently. Any mortgage with less than a 20% down payment must be insured, so currently you have to have 20% down (ie: $200,000 cash) to buy a house over 1M. With insurance now available up to 1.5M. people will be able to buy homes with less cash down.

4. First-time home buyers and buyers of new build homes will be eligible for a 30-year amortization, also taking effect December 15th. This lets buyers stretch out their payments over a longer period of time, which reduces the amount they have to pay each month.

All of this means that home ownership is getting more affordable, thanks to improved access to financing, and financing costs, especially for first-time buyers. This is great news for the real estate market here in Winnipeg.

Given the new 30-year amortization for buyers to build new homes: The Parade of Homes kicked off last weekend! Parade hours are Saturday and Sunday 1-5PM and Monday to Thursday 5-8PM until Oct 13th. We are showcasing four beautiful show homes for Discovery Homes Ltd, and would be happy to give you a tour anytime. 

 If you are looking for strong, competent and experienced advice in real estate this fall, please reach out to me at 204-995-7355.