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Buying a Home in the Halton Region? It Could Soon Get More Difficult

Whether you live in Burlington, Oakville, Milton or another area within the Halton Region, you are going to want to read about this.

As if it wasn’t difficult enough to purchase a property in the area, buying a home within the region could soon become much more difficult. We already know that you have to spend a pretty dollar to secure the home you want, but new mortgage regulations announced by the Bank of Canada may make it even harder.

Beginning in 2018, mortgage stress tests could possibly get rid of nearly 10% of people looking to buy homes. One of the reasons for introducing this latest stress test is to filter out even further the potential homeowners who are very much in debt.

It used to be that if you could put 20% or more on a down payment for a home then you would be fine. However, the new rules mean that even those who put north of 20% down could have a hard time getting a loan. A recent report called the Financial System Review said that is was worried about low-ratio mortgages and that they have seen more “come through with risky characteristics”. It also noted that these borrowers are opting for a period of longer than 25 years.

How will people looking for a loan respond? Or, how will it affect the lenders? After the last rules were introduced, cities were taken aback as they attempted to adjust. Many cities recovered fine and were back to their red-hot ways, such as Vancouver, but we may not see as big of a recovery once the latest changes are made.

With a pair of hikes in the interest rate expected next year, we are likely to see a drop in sales across the region.

Increased interest rates combined with stricter lending rules should filter out many potential homebuyers, but the real factor in how the housing market responds depends on the Canadian economy. Should employment, wages and population increase we can be sure to see demand grow as well.

It’s fair enough to say that the initial months of 2018 will be critical in attempting to predict how the market will fare in the New Year.

With a pair of hikes in the interest rate expected next year, we are likely to see a drop in sales across the region.

If you’re considering purchasing a home, speak with one of our qualified brokers today and find how we can help finance your mortgage in Burlington! Source: https://www.inhalton.com/its-now-more-difficult-for-even-more-people-to-purchase-homes-in-halton-and-beyond

Source: inhalton.com

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