Buyers Scramble To Get Into The Spring Housing Market Before Interest Rates Rise
Wednesday Feb 09th, 2022
At the end of January 2022, the Bank of Canada decided to keep the interest rate low, which has set the stage for another hot spring real estate market. With this news, buyers have sprung into action before rates go up later this year – and sellers are fervently listing their homes to capitalize on the market.
Rising Rates Are Coming Fast
After nearly two years of record-low interest rates, some economists and mortgage experts expect a rate increase as soon as March 2022, when the central bank hopes the Omicron variant of COVID-19 will finally calm. Some experts also anticipate four to six subsequent hikes within the next 12 months. This increase will slow the overheated housing market and cool inflation, which was 4.8 percent at the end of 2021.
The Hot Spring Housing Market Is Already Here
With the news of the impending rate increase, buyers are getting into the market before it’s too late. This rush creates an even more competitive housing market, which is already hotter than usual.
Canada’s housing market ended year two of the pandemic with record highs in price growth and home values. According to the Canadian Real Estate Association’s home price index, the typical price of a home across the country rose 26.6 percent in December 2021 compared with a year earlier. That’s the fastest pace on record and hits a new high of $811,700.
In the Toronto region, prices are well above $1-million, and many cities in Southern Ontario have topped $800,000. Homebuyers have also shown a growing interest in suburban homes and rural areas, pushing up prices in cities, including Mississauga, Oakville, Burlington, Hamilton, Guelph, Kitchener, Cambridge and Barrie.
What the Spring Real Estate Market Will Look Like for Buyers
Given the predicted ongoing housing supply shortages and an influx of buyers in the market, prospective buyers need to be prepared.
First and foremost, home purchasers must seek mortgage approval from a lender. This step is essential for buyers to understand their financial circumstances, know how much they can afford and determine their price range.
Next is finding a realtor to assess homebuyers’ needs and help them hone in on neighbourhoods and areas that address their requirements and fit within their price range. Buyers need to know exactly what they want in a property before touring homes. With so much competition, there is no time for waffling. As new properties become available, purchasers need to view them within the first day or two of listing to get ahead of the competition. Buyers must also have quick access to deposit funds in the event of an offer.
What Sellers and Investors Can Expect From the Spring Housing Market
Unlike buyers, sellers have the upper hand with the current market conditions as more purchases race to buy a home before the impending rate hike.
But sellers shouldn’t rest on their laurels. Professional staging and photography are necessary and perhaps even more critical than ever before. Living in pandemic times amid the competitive market conditions, more buyers narrow properties online before making a showing request. Out-of-town buyers and investors are increasingly making offers without stepping foot into a property. A professional online presence is critical to generate interest from eager buyers and sell for top dollar.
The Race Is On
The spring market is already underway in the Greater Toronto Area, and the race to buy and sell is on! So whether you are a home buyer looking to lock in a record-low interest rate and find a property in your preferred location and price, or you are a seller eager to capitalize on this hot spring market, you must act now! Contact me right away before this opportunity passes.
I work with sellers and buyers every step of the way to provide the best real estate experience. I offer a full range of professional services to get the most money for your home in the shortest time with virtual tours, photography, videography and home staging. When working with buyers, I also provide the finest representation possible with personalized and uncompromising service that strives to find my clients a home they feel excited about – and negotiate a price they feel good about.