The most recent mortgage qualification changes the mortgage “stress test” implemented at the beginning of last year, continue to impact the type of home Canadians are eligible to purchase.
Although interest rates will not be increasing in the near future… you still have to prove you can afford your home if interest rates do change.
How will this affect your ability to move homes?
Stress tests used to apply only to those who had a down payment of less than 20 percent; however, the updated rules now extend to anyone applying for any mortgage — whether a variable or a fixed mortgage — even if they have a 20 percent or greater down payment.
The impact of the stress test means applicants must prove they can still afford mortgage payments if rates were to increase. This has been, in many cases, reduced affordability.
Because of this, some buyers who may previously have been considering moving may be in a quandary about what they can now afford.
There’s no doubt that buying a home is expensive, but heading out with a set budget and a good understanding of your financial footing will go far in your successful house hunt.
What Should You Do?
As always, if you need help buying or selling your home don’t hesitate to contact Gregg Bamford or Ryan Bamford.
If you’re wondering how much your current house is worth in today’s market, you’re invited to call today for your complimentary price evaluation. Gregg and Ryan would be happy to assist you with you all pricing needs.
Whether you’re ready to buy or sell now, are just keeping an eye on the market for a possible future move. We are here to help.