If you have a mortgage or are getting a mortgage … here’s what you need to know going into 2019.
First, a quick look back at 2018…
The Bank of Canada raised rates 3 times in 2018. January 0.25%, July 0.25% and October 0.25% … increasing variable rate mortgage & credit lines by 0.75%
After consecutive years of real estate prices increasing … real estate prices softened across the Lower Mainland. From June to November 2018: Detached house prices dropped 5.80%, Townhouse prices dropped 4.20% and Apartment prices dropped 5.60%.
Government Intervention is stacking up. The mortgage stress test, Bank of Canada rate increase, Foreign Buyers Tax, Vacancy Tax and the $3 million home property tax increase all contributed to slower housing.
But it’s not doom & gloom. Vancouverites are just fine. For those that purchased 3 years ago: Houses are up 30.4%, Townhouses are up 52.7% and Apartments are up 59.5%.
So what do we need to know going into 2019?
Housing forecasts are mixed for 2019.
CMHC says Metro Vancouver will see lower home prices. Royal Lepage says Vancouver home prices will rise. REMAX forecasts Vancouver home prices to fall 3%.
Mortgage rate predictions are also mixed for 2019.
“There is little need for the Bank to raise interest rates further” says Capital Economics. The BC Real Estate Association is calling for a “0.25% variable rate increase in 2019 & stable fixed rates”. And TD Economics predicts a “0.50% variable rate increase in 2019”.
And the bond charts show fixed rates have downward pressure at the beginning of 2019.
Predictions vary so always do what’s best for you. Here’s 5 tips to help your decisions depending on your needs …
Is your mortgage up for renewal in 2019?
Call your mortgage broker early. The stress test may limit you from negotiating your rate.
Is your debt piling up?
See if it makes sense to join you debt & mortgage. You may lower your rate and payments.
Thinking of accessing the cash value in your home?
Act soon because if your home value drops & interest rates rise, you could be approved for less.
Are you retirement planning?
Your home value is a key part of your planning. Consider borrowing for lifestyle comfort or to help family.
Are you buying your first home?
Consult with a mortgage broker to increase your solutions. Every lender approves you differently.
For personalized mortgage guidance complete an online application or contact us.