Home Buying in the Current Real Estate Market

Finding and buying a home in Canada has become harder because many people want to buy houses, but there aren’t enough available. This high demand has made house prices go up, especially between 2020 and 2022.

There have been regular interest rate hikes to help control overall inflation and the soaring house prices.

On July 12, 2023, the Bank of Canada raised it’s policy rate by 25 basis points to 5%. This is the highest it is been in 22 years. The policymakers have said they are still prepared to raise their benchmark interest rate further, if required to control inflation.

With such high interest rates, are there still home buyers in the market?

The answer is yes! There will always be real estate investors and home buyers in the market, given the demand and supply issue across Canada, especially in the main centres, in our case, across the GTA. According to the TRREB June real estate market report, demand for owning homes is stronger than last year, despite higher borrowing costs. However, with tight lending rules and high interest rates, it is very difficult for buyers to succeed.

To be successful in this competitive market, you need to learn about how it works and follow some tips.

Market overview:

The housing market in Canada is affected by different things like the economy, how many people are moving to the area, interest rates, and government rules. By keeping track of these factors, you can understand how the market works and what makes prices go up or down.

For example, when interest rates are low, more people can afford to buy houses, so prices go higher. But if there are many houses for sale, prices may be lower because sellers have to compete with each other. By knowing about the market, you can decide when and where to buy a house and get the best deal for your money.

Budget:

Before you begin looking for a home, it’s important to know how much you can afford to spend. Think about not just the price of the house, but also the extra costs like taxes, insurance, and maintenance.

Be practical about your budget and consider unexpected expenses too. To figure out your budget, you can get pre-approved for a mortgage. This means the bank will tell you how much money they are willing to lend you.

Knowing your budget will help you focus your search on homes that you can afford, so you won’t be disappointed or have money problems later.

Mortgage Pre-approval:

Getting pre-approved for a mortgage means the bank checks your financial situation and agrees to give you a certain amount of money for buying a home. This helps you understand your budget and makes it easier to find homes within your price range.

It also shows sellers that you’re serious about buying and that you can afford their home. Plus, it speeds up the home-buying process because the bank has already evaluated your finances and creditworthiness.

Working with a Real Estate Agent:

In Canada’s competitive housing market, working with a real estate agent can be beneficial. They can provide valuable insights into the local market, including pricing trends, neighborhood amenities, and available properties.

In a competitive market, an agent can give you an edge by helping you act quickly on new listings and make strong offers.

Being Prepared to Act Quickly:

In a competitive housing market, being ready to act swiftly is crucial. Stay informed about new listings and be prepared to make an offer when the right home becomes available.

Properties sell quickly in a hot market, so ensure your finances are in order and be ready to seize opportunities. Timing is essential, and being prepared to act quickly can greatly contribute to a successful home-buying experience.

Flexibility:

To improve your chances of finding the perfect home, it’s essential to be flexible and open-minded. This means considering different neighborhoods, types of properties, and price ranges. Sometimes, you might need to compromise on certain features or amenities.

For instance, if you can’t find a house in your preferred neighborhood, be open to looking nearby. Similarly, if your budget is limited, think about considering a fixer-upper or a smaller home. Being flexible and adaptable will increase your chances of success in a competitive housing market.

Even though the housing market in Canada can be tough, you can still find your dream home with the right approach. By following these tips and working with reliable real estate professionals, you can confidently navigate the market and find a home that fits your needs and budget.

Why it’s important to work with an experienced local buyer agent:

Especially as a newcomer, you may wonder why should I work with a buyer agent? First off, as a buyer you do not pay any commission to your buyer agent to purchase a home, as it is typically paid for by the seller.

Secondly, working with an experienced local buyer agent can greatly simplify and clarify your house-hunting journey. They bring their knowledge and expertise to the table, making the process less overwhelming. Let’s explore the key qualities Canadians seek in a real estate agent nowadays.

Knowledge of the Market and Industry:

A top-notch real estate agent stays updated on the latest happenings in the industry, such as changes in buyer preferences, regulations, and financing options. They possess a deep understanding of specific neighborhoods and communities within their coverage area since most homebuyers seek a sense of belonging.

Technology and Communication Skills:

Today’s homebuyers expect immediate access to information. An excellent agent promptly provides relevant details about homes for purchase. They are adept at sorting through and summarizing information, using multiple platforms and channels to communicate effectively.

Ability to Identify Possibilities:

Homebuyers want spaces that can accommodate their various needs and adapt to their evolving lifestyles. A great agent has a keen eye for spotting houses that may be perfect matches, even if they don’t initially meet all the buyer’s criteria. Their experience, imagination, and knowledge of emerging communities allow them to reveal the potential in homes that might have been overlooked.

Personalized Service:

Clients prefer real estate agents with whom they can connect on a personal level. An agent with excellent listening skills can understand their clients’ desires and requirements in a home. By empathizing and adapting to each client’s unique journey, the agent can help them achieve their vision for the future.

Honesty and Transparency:

Access to information is unprecedented in today’s real estate market, which can be overwhelming. A reliable agent can synthesize current and projected information and provide honest and transparent communication. Buyers seek clarity on what they can afford, potential market fluctuations, and the development plans for nearby areas. An agent who can address these concerns with integrity becomes an invaluable resource.

Decision-Making Support:

Purchasing a home can be confusing and stressful due to its significance and potential financial risks. Buyers seek agents who can guide them through the process, offering support while respecting their individuality and decision making freedom.

By collaborating with an experienced local buyer agent who possesses these qualities, you can navigate the homebuying process more smoothly and confidently.

Why Choose Team Kalia to Buy Your Home or Condo?

Looking to Buy or Invest in a Home on Condo in the GTA? Contact Team Kalia Today!