Speculation continues about the potential increase in minimum downpayments for mortgages backed by the CMHC but would homebuyers be put off if it were to happen? With the possibility of having to find a minimum 10 per cent of a property’s purchase price experts are concerned that it could derail the housing market as buyers are unwilling or unable to find the additional funds. However, a new poll by Re/Max suggests that most Canadians are in favour of raising the limit.
The survey shows that 66 per cent of respondents say that 10 per cent or more is the right level for a mortgage downpayment. It’s not clear whether those polled were already homeowners or first-time buyers (who would be hit hard by the change.) The report did acknowledge that Toronto and Vancouver could suffer a reduction in sales due to higher prices. The poll also found that 91 per cent see homeownership as part of the Canadian dream and 71 per cent believe realtors “provide value” to a home purchase or sale.
Re/Max published its outlook for 2016 in which it highlights low supply and high demand in the two hottest markets with “no sign of it waning”. In 2015 Greater Vancouver prices increased 17 per cent from the previous year to an average of $947,350; and prices in the Greater Toronto Area were up 10 per cent to $622,150. In surrounding cities there was a spillover with Victoria increasing 13 per cent, Fraser Valley up 10 per cent, Hamilton-Burlington up 12 per cent and Barrie up 8 per cent.
RE/MAX 2016 average residential sale price expectation for Canada is an increase of 2.5 per cent as Canadians continue to see home ownership as an important milestone as well as a good investment.
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