Canadalend.com, the leading low-cost, private mortgage solution advisor, is weighing in on the Canadian housing market’s rising home prices and why the lowest mortgage rate is not always the best option for potential home buyers following a high-profile interview by the Canadian Press. —
According to the Teranet – National Bank National Composite House Price Index, home resale values hit a record high in March. Home prices were up in nine of 11 major Canadian cities compared to March 2014, with Toronto and Vancouver setting new records. Nationally, average home prices rose 9.4% in March to $439,114. (Source: “Teranet – National Bank National Composite House Price Index,” HousePriceIndex.ca; www.housepriceindex.ca/, last accessed May 12, 2015.)
“Spring is the most active period for home buying and selling. And this year is no exception,” says Bob Aggarwal, president of Canadalend.com. “With supply tight and housing prices rising fast, lenders are looking at new ways to attract home buyers in an increasingly competitive marketplace. The first thing home buyers look at is interest rates, so that’s where we’re seeing the most competition between lenders.”
Aggarwal explains that the majority of calls Canadalend.com now gets are about mortgage rates, echoing his recent high-profile interview by the Canadian Press. (Source: Posadzki, A., “Bargain-basement mortgage rate may not be what you want,” The Toronto Star, May 11, 2015;
http://www.thestar.com/business/personal_finance/spending_saving/2015/05/11/bargain-basement-mortgage-rate-may-not-be-what-you-want.html.) He notes that while low rates are one factor for home buyers to consider, it’s important to consider other factors as well. Where mortgage contracts used to be standardized, many now include conditions or clauses that could affect your purchase and payments further down the line.
“Mortgages can come with conditions that home buyers will want to consider based on their individual circumstances. While home buyers may be able to lock in lower mortgage rates, they’ll also want to consider any potential penalties for paying it off early; lower prepayment privileges; the ability to refinance, move, or transfer the mortgage; and so on,” explains Aggarwal. “On top of that, rate reductions are only in place for a small period of time. And to qualify for the low rate, many first-time home buyers need to qualify, for example, on a higher five-year rate.”
“It can be difficult for home buyers to understand the difference between the various financial products offered by competing lenders and which best suits their needs. That’s where licensed, independent agents come in,” Aggarwal concludes. “They sit down with the clients and review all the factors, helping them find the right option to meet their financial and lifestyle needs.”
Canadalend.com is one of the largest, most trusted private mortgage brokers in Canada, with skilled independent, licensed professionals helping Canadians coast-to-coast. To learn more about Canadalend.com, visit the company’s web site at www.Canadalend.com.
Release ID: 82494