What is happening in the current Real Estate Market?
With the current pandemic of the COVID-19, several people, businesses and the overall market has been greatly affected. We cannot predict what will happen tomorrow or in the next few weeks, but we can provide you with the most updated statistics of the buyer and/or seller market.
Unlike the stock market, smart buyers today are still investing their money in properties. Sellers are continuing to list their homes for sale and are actively looking online to purchase their next property.
As per the RE/MAX Niagara & Escarpment Appointment Centre here are some of the most up-to-date statistics of the real estate market:
From March 15-21 2020, there has been a 10% increase in appointments compared to March 2019. There were 16.1 appointments on average per property sold during the week. Our office still had 102 properties sold during the week, showing that the market remained quite active. (RE/MAX Statistics 2020)
Should I purchase a home or an investment property now or wait?
Though the market is a bit off right now, things will get better and our lives will go back to normal! In the current market, people are still continuing to purchase homes and/or investment properties. On March 27th, 2020, The Bank of Canada cut its benchmark interest rates by another 50 bps to 0.25%, bringing the overnight rate to the lowest level since the financial crisis a decade ago (J.Bains, Yahoo Canada). This is definitely a good time for investors to re-finance their mortgages, home equity line of credit and be able to receive lower interest rates. Investors can also defer mortgage payments, an option now being offered by several big banks in Canada (more information about this below).
What should I do if the closing of my house is coming up soon and/or I am in the middle of selling my property?
Inventory for housing is low, yet there is still bidding wars happening for some properties on the market. It is best for sellers not to take their property off the market right now. Now more than ever, people are at home and are on the internet looking for homes for sale without the added distractions. There is definitely a lot of online activity going on! If someone is eager to buy, they might even put in a higher offer than what you are asking for! There is still some hope for your house to sell!
How will my mortgage be impacted and what are my options for deferring my payments?
There are several options for mortgage deferrals for people who have purchased investment properties.
According to the mortgage expert, Brian Hogben from Mission 35 Mortgages, Scotia Bank is currently allowing 3 non-residents to defer payment with a questionnaire. With more than 80,000 people calling into the banks daily, the situation is changing on an hourly bases.
Other financial institutes, such as Credit Union, First Ontario, Home Trust and other B-Lenders are taking the situation case by case. Most of these lenders are waiting for the first week of April to visualize the situation.
RBC Royal Bank expert, Patrick Tremblay, mentioned that they are accepting deferrals up to 4-5 investment properties for 6 months, without any questionnaires. Over 60,000 deferrals have been processed nationally and they are continuing to accept all requests.
For first-time home buyers, those who have been laid off or are either purchasing their homes, the banks will view their situation case by case.
We highly recommend that you call your financial institution or mortgage broker for more information on today’s deferral payment options and mortgage rates.
Will a mortgage deferral hurt your credit score?
According to Patrick Tremblay from RBC, people are not only deferring mortgage payments but clients are also coming in for deferrals for other payments such as auto loans, installment loans, credit cards and so forth. At the moment, RBC, Transunion, other financial institutions and credit agencies are getting together with the Rating Agencies to discuss how to move forward with this. With the situation changing daily, it is best for you to call your financial institution to see what they can offer you and to see if your credit score will be affected during this period.
What will happen to the Real Estate Market in the long-term?
It is hard to predict how long the COVID-19 will last, but we are hopeful that the market will bounce back soon. Once the Coronavirus health risks are diminished, we can definitely expect the real estate market to recover quickly and the financial market to even out. Until then, you can continue buying, selling or investing in properties with the Nexus Group, in a safe and friendly manner.
How is the Nexus Group providing safe business services to its clients?
We want to continue offering safe and unparalleled services to all of our clients. The Nexus Group is minimizing in-person contact, however we are still open for SAFE business. We are now offering virtual consultations and home tours via Zoom, Skype or FaceTime. Our website will always be open and we will still be available through live chat, social media, email and by phone.
Our team, the Nexus Group at RE/MAX Escarpment wants to ensure that all of our clients are safe during this time and that they are fully protected while buying or selling their home. Our broker of record at RE/MAX Escarpment, Conrad Zurini, has introduced a special clause for COVID-19 protecting our clients in any real estate transactions. (For more information about this clause, please contact us today!)
We will continue posting and updating our clients about the current real estate market statistics and help guide you in the right direction.