The wavering economy and loose forecast have left some home buyers with reservations on when the right time to purchase might be.
The unknown about if or when housing prices bottom out has become an attractive incentive for some buyers, but there are two sides to every coin.
Waiting for our prices to bottom out to achieve the best deal possible might actually work as a disadvantage, as before you know it, prices are back on the climb and your opportunity is missed.
With sale prices down and interest rates remaining low, making the move from being a tenant to becoming a homeowner can be a smooth transition. Or is it?
“The government is saying you should not be a homeowner if you cannot afford it,” warns Benjamin Tal, deputy chief economist at CIBC World Markets Inc.
But how can you not afford not to make a long-term investment in real estate when on a $200,000 mortgage at the current rate of 3.09 per cent on a five-year term with a 25 year amortization period, one example offered by Dominium Lending Centres, your monthly mortgage rate would be about $955.
But there seems to be another concerning factor for purchasers, the lingering issue that the current housing market bubble will burst.
But how long are we to wait for this to possibly occur? When will we really hit rock bottom?
Perhaps we should consult with what other economists see in their crystal balls.
Tsur Somerville, director of the University of BC’s Urban Economics, states: “I don’t have a crystal ball but if I had to guess I would be more likely to guess this kind of lower sales/flat prices is more likely to continue.”
David Madani, economist with Capital Economics, is continuing to forecast housing prices in Canada to crash 25 per cent over the next few years.
The Canadian Real Estate Association has forecasted sale prices to increase 2.2 per cent from 2011 and rise modestly in 2013 another two per cent.
So despite conflicting views from economists and continuous scares of mortgage rates climbing and the housing bubble bursting, Canada has continued to show strength by being ranked in the top seven of 39 countries for housing markets by Global Property Guide’s.
And with Kelowna’s employment rate reflecting an all time low of 4.1 per cent, maybe the time to make the transition to home ownership is now.