Back about 18 months ago, I can clearly remember thinking that things would change in the real estate market. Fast sales, multiple offers, interest rates, home prices... they'd all change.  After twenty years in the business, I've seen enough changing cycles of the market to know that nothing ever lasts.

18 months ago, buyers here in the Collingwood - Blue Mountain area were often frustrated because they had little time to think.  When a suitable home came on the market, it would often sell before they could arrange to see it or before they could make an offer.  They were often in competition with other eager home buyers and, they were anxious about getting into the market during a time of rising prices.  If I had said, "Don't worry.  Soon prices will soften, you'll be in a buyers market and you'll get a better interest rate," they would have called me crazy.

Well that day has arrived and buyers are in the drivers seat.
And...
... they've disappeared onto the sidelines.  Waiting.  The question is, waiting for what?

The most common reason I hear for buyers delaying a buying decision is fear.  They are afraid that prices will depress further and that whatever they buy today may be worth less tomorrow.  This is a valid concern but only to a point.  There are many factors buyers should consider and one of the most important ones is interest rates.

Right now, interest rates are at an almost historic low.  Here is a chart setting out the Bank of Canada overnight lending rate for the last decade:

The reason interest rates are so important is that they determine the bottom line of what is actually going out of your pocket each month in hard earned dollars. An increase of just 1 or 2 percentage points in the interest rate can wipe out thousands of dollars in equity over a mortgage term.  Here's an idea.  Go and visit a mortgage calculator site such as this one and play around with various purchase prices and interest rates.  Take a look at the interest based over the mortgage term and see what just 1 or 2% will do to your bottom line.

In addition, the federal and provincial governments are currently offering all kinds of incentives for home buyers ranging from closing cost rebates for first time buyers to renovation and ecoEnergy grants for homeowners. 

For many people, now really is a good time to buy and for others, it may be better to wait and see.  A REALTOR® can help you determine the right options for you and you alone.

When it’s time to buy or sell real estate in the Collingwood, Blue Mountain or Georgian Triangle area, contact Marg, an experienced and competent Broker who’s ready whenever you are!