Here is a commentary from TREB about a study by the C.D. Howe Institute. It points to the misconception that the Canadian Real Estate Market is doomed to follow the U.S. Real Estate market in the next few months.
Here are their thoughts:
My own thoughts?
At last count, a quarter of 1% of mortgages in Canada were in default whereas in the U.S. recently over 12% of mortgages were delinquent. Have a look at the charts above.
When interest rates really increase (more than one or two points) and immigration to Canada drops, we will have a serious correction.
Until… expect the market to have seasonal fluctuations and the normal peaks and valleys moving through a seller’s, balanced and a buyer’s market.
If you are waiting to buy and being counselled not to, remember that you must live somewhere and that buying rather than renting allows you to build equity… especially if you can make use of the today’s lower rates to pay down financing or make improvements.
For the full report see: http://www.cdhowe.org/pdf/ebrief_105.pdf
Your thoughts? Feel free to comment below!