Buying Real estate in Calgary
Is now a good time to buy property in Calgary?
The last couple of years have been a bit of a roller coaster for those buying real estate in Calgary. But now, thankfully, those hoping to get into the market will find 2018 a good time to buy property in Calgary. Experts say that while there are still a few influences that will drive prices up, there are quite a few other dynamics that will pull them back down. Simply put, overall the prices are likely to stabilize.
The decision to buy a house is one of the most important that we make in our lives. Largely, we tend to base these decisions of buying real estate on the basis of feelings or social pressure rather than on market factors or logic. In this article, we discuss the why factors of the current market and how you should not postpone your search for a home.
Factors that affect buying real estate in Calgary
Though not as fluctuating as the stock market, real estate too has its share of ups and downs. Exactly predicting when the real estate market is the best for buyers or sellers successfully is very difficult. Prices depend on a number of dynamic factors.
Housing market/ prices:
The current market prices are one of the most encouraging factors for buying real estate in Calgary. Despite the decline in the Calgary market since early 2015, affordability of housing has improved. There is also a good chance of prices increasing due to the budding demand in the following year. But according to RBC’s predictions for the next quarter, this rise will stay very much within the safe zone.
Mortgage and interest rates:
Though interest rates seem to have gone up now, the fact is that the past rates were at an all-time low. The increase in current interest rates is a natural progression and actually signifies an overall improvement of the economy. In Calgary, our interests rates are still at a low rate compared to historically when several years ago we've been closer to 18%, 20%. The current interest rates can be considered very reasonable, making buying real estate in Calgary still very viable. Six years ago, interest rates were almost at the same level to what they are today. Mortgage rates are still lower than they were a decade ago, and for that matter even five years ago.
Early in January 2018, the government implemented the mortgage stress test. This, in essence, tested the repayment power of potential homeowners against a higher rate than the market value. This led to a dip in sales at the beginning of the year, leading to a large inventory currently. There has also been a jump in resale listings. In July, the overall listings in the Calgary area were up 26 percent compared to last year, according to the Calgary Real Estate Board (CREB).
Unemployment has fallen by a good amount in the current year in Calgary. The market in Calgary is also showing a lot of drifts towards improvement, so we're out of the recession. While a sustained growth is expected moving forward, the economy still hasn’t reached the levels that were prevailing before the recession began. That said, the number of people buying real estate in Calgary while low now, is definitely following an upward trend.
Strategy to buying real estate in Calgary
The first thing that you need to understand in the current real estate market is that when it comes to buying real estate try not to get into the game of forecasting the exact upward or downward trends of the market. You will very easily drive yourself crazy trying to figure out and wait for that ideal time to buy property. Because it is very unlikely that everything is going to line up exactly as you think. There are plenty of market-gurus and experts who have tried and failed with picking markets. Make sure you avoid adding yourself to the list.
So, if you live in Calgary and are in a stage in your life where you are looking for a brand new place, there are currently a lot of benefits to buying new versus waiting or renting. But as with any significant purchase, you need to ensure that you choose real estate wisely and only spend what you can afford.
In real estate, we have all heard the adage, location, location, location. Buying real estate in Calgary, where the demand factors are strong and economy is growing is a very safe option. If you plan to buy as an investor and choose a property that will be attractive to a renter, which means being close to the city and amenities.
Seasons also play a role in buying real estate in Calgary. Usually, the spring sees a lot of people coming out and looking a little bit more just because they're getting ready before summer holidays to get into a new place, or if they're moving before the summer. So buying a house in this time when the demand is slightly lower may also add to your advantage.
Future trends of buying real estate in Calgary
So the next question is what the likely future of real estate is. Should I wait for prices to lower? Will rates of interest continue to fluctuate?
Well, right now, there are a number of reasons and aspects that when considered together, will most likely lead to higher prices over the longer term. Buying real estate in Calgary may not always be as appealing.
Growth in population:
Data suggests a significant level of growth in the coming years. One of the factors attributed to this is the surge in immigrants. More people mean more demand for housing. And more demand means prices will go up.
As the economy improves, the interest rates are most likely to increase. This increase in interest will mean higher mortgage values in the future.
The overall global growth means as more wealth is created, more people are looking to invest. And as you now know, more people investing means more demand, which, again means rising prices.
So, what are you waiting for?
With all this information, you should now have a fair idea of the real estate market and why it is a good time for buying real estate in Calgary. Yes, the higher rates of interest may pose as a bit of an inconvenience, waiting for it to come down would be to no avail.
With all this information, you should now have a fair idea of the real estate market and why it is a good time to buy property. Yes, the higher rates of interest may pose as a bit of an inconvenience, waiting for it to come down would be to no avail.
Check out some of the best real estate in Calgary right here.