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According to Fitch Ratings, the anticipated correction in the Canadian housing market will continue and is not expected to rebound until the back half of the year. Canadian home prices are expected to fall another 5% - 7% in 2023, however home prices are still up 20% from pre-pandemic levels – supported by tight supply and continued strong demand. The Bank of Canada is unlikely to increase rates again in 2023, given declining headline inflation.
In the Spotlight – How to navigate the challenging mortgage market
From the record low interest rates in 2020 and 2021, we now have rates that have more than doubled. Purchase demand and home prices are starting to decline, and borrowers are really feeling pressure from inflation. Here’s how to navigate these turbulent times and maximize the current year.
- Keep your credit in shape.
- Get pre-approved and lock in your rate.
- Consider different rate options.
- Consider a higher down payment if possible.
- Buying a home with family can make it easier to qualify for a loan.
- Budget wisely
Fact vs Fiction - Three misconceptions about mortgages:
- You need to be debt-free to qualify for a loan.
- Your only upfront cost is your down payment.
- You need a 20% down payment.
Home ownership in Canada stands at around 66.5%6. Even so, many Canadians are worried that the soaring house prices and increasing interest rates will make home ownership a distant dream.
Did you know?
A reverse mortgage is a simple way to turn a portion of your hard-earned home equity into tax-free cash - with no ongoing payments required.