As you make your way through the headlines, it’s undeniable that consumers would have concerns with the current economy and the further potential impact it could have on each of us in Canada…and of course more personally, right here in Alberta.
When it comes to real estate, this couldn’t ring truer. More than ever, people are asking: Is now a good time to buy?
Here is what we do know: The growth of the Canadian economy continues to struggle in the wake of lower oil prices and the continual loss in Canadian dollar value. We have also seen many job cuts and lay-offs in the retail and natural resource industries in particular. This of course is very unsettling and is a concern for many.
According to the Globe and Mail, a quarter of Canadians say they are looking to buy a home. But many aren’t sure now is a good time and want to wait and see what happens in the economy. Is this a good strategy? Should you wait?
What we also know is that interest rates are at historical lows. So far it appears, that until the economy starts to grow, low interest rates are here to stay. There have also been several regulatory changes made to mortgage lending, to help keep consumers in a healthier financial situation. Being more capable to sustain their mortgage payments, if sudden changes to their finances were to occur. We also know, it has shifted to a buyers market.
Although it is important to be cautious in these uncertain times, we believe it is even more important to be financially educated. By putting yourself in a stronger financial position and understanding your finances in a better way, many of the pitfalls that could occur, can be avoided. After all, a mortgage is one of the few debts that are considered a good debt to have. You can check out our link to our rent vs buy calculator at: http://www.reddeermortgagelending.com/index.php/mortgage_calculators
Seeing someone invest in a home, which everyone needs, is much more rewarding than seeing someone struggle to pay off thousands of dollars of unsecured debt, which is so easily attainable and yet feels impossible to get rid of, even when the economy is at its strongest point.
For us, as a team of mortgage professionals and financial coaches, part of educating our consumers is going back to the basics and helping people really understand their money and how to use it. The value of cash versus credit. We teach ideas and strategies that are so simple, yet extremely effective. The value of understanding the difference between good debt versus bad debt and how debt works for you or against you. As a society, we don’t seem to be afraid to go out and buy a $60,000 truck with a $1,000 a month payment, regardless of the current economy. Nevertheless, many it seems are still on the fence when it comes to purchasing a home.
We believe that if financial advisors, financial coaches and mortgage professionals took more time to educate and weigh out the options and concerns, consumers would feel much more at ease about purchasing a home.
Something else to keep in mind; as the economy improves, rates will start going up. This means that if you were approved for a mortgage now, the amount you were approved for will decrease and your mortgage payment will be higher. The end result will be less house that will cost more money. For some, another reason not to wait.
With historically low rates, a buyer’s market, a lot of inventory and most of all, an experienced mortgage professional working with you and coaching you through this major life decision…it may just be your time to buy. If you’re still not sure if purchasing now is right for you, contact us and let’s sit down to review your current financial situation. Everyone’s situation is different, we’re here to help you with yours. Our services don’t cost a thing. Red Deer Mortgage Lending is here to help!